RR Kabel Sees Record Q1 Revenue, Eyes Long-Term Growth in India's Thriving Real Estate Market
RR Kabel's Q1 revenue hits a record high of Rs 1808 crores, driven by strong growth in the wire and cable segment, despite challenges in the industry.
Rr KabelWire And Cable IndustryReal Estate MarketIndia Gdp GrowthElectrical GoodsReal EstateSep 14, 2024
The wire and cable segment contributed to about 87% of the total revenue, with exports accounting for approximately 24% of the total revenue. The company's EBITDA stood at Rs 95 crores, while profit after tax was Rs 64 crores for the first quarter of FY25.
RR Kabel's Fast Moving Electrical Goods (FMEG) segment also saw an impressive 32% sales growth, driven mainly by products such as fans, appliances, and electrical switches. The company has launched a new product in the house wire segment, which is a major innovation in safety standards and aligns perfectly with the new regulation of the central electrical authority.
This halogen-free wire product is perfectly positioned to meet the critical safety requirements in the country's construction sector. RR Kabel is undertaking numerous initiatives to bolster its growth over the next few years, including introducing high-margin products, expanding its distribution channel, increasing its capacity, and launching new products.
The real estate market is a significant contributor to India's GDP growth, and RR Kabel is well-positioned to benefit from this growth. With the government's strategic focus on real estate and infrastructure development, the initiatives undertaken will greatly benefit the Indian electrical industry and RR Kabel.
The company has cemented its position as one of the largest wire and cable players in the country and is poised to achieve greater heights. RR Kabel is improving its working capital requirements through sound financial management and is spending Rs 500 crores on capital expenditure, which will be completed by the last quarter of FY25.
Apart from sectors like infrastructure, the other bigger growth areas that RR Kabel is exploring are railways, defense, solar, and alternative electrical manufacturing resources. The management is upbeat and expects that demand will be much higher than supply, despite capacity building being undertaken by other large industry players.
The Indian wire and cable industry is well poised for strong growth, with a significant shift happening in favor of large branded players. Multiple long-term growth drivers, such as EV transition, renewable energy, export promotion by the government, and rural electrification, are expected to drive growth in the future.
RR Kabel's stock is currently quoted at Rs 1650, and analysts and fund managers are bullish on the scrip for long-term price appreciation.
Information
RR Kabel is a 20-year-old wire and cable industry company with 5 manufacturing facilities in the country. The company was recently listed on the stock exchanges.
RR Kabel is a leading player in the Indian wire and cable industry, with a strong presence in the domestic market and a growing export business. The company is committed to providing high-quality products and services to its customers, while also focusing on innovation and sustainability.
Frequently Asked Questions
What is RR Kabel's Q1 revenue for FY25?
Rs 1808 crores
What is the growth rate of RR Kabel's wire and cable segment?
13% year-on-year growth
What is RR Kabel's EBITDA for Q1 FY25?
Rs 95 crores
What is the contribution of exports to RR Kabel's total revenue?
Approximately 24% of the total revenue
What is RR Kabel's stock price currently?
Rs 1650
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