Polycab India gets a fresh charge as broker retains 'buy' rating
The stock has come under pressure since UltraTech Cement entered the wires and cables market with its Ultravolt brand. UltraTech launched Ultravolt last Thursday with an investment of Rs 1,800 crore, of which Rs 900 crore had been incurred as of June 2026.
UltraTech plans to roll out Ultravolt products across 500 districts through more than 1 lakh retailers. The company has started commercial production at the first phase of its facility in Bharuch, Gujarat, with an installed capacity of 1.1 million kilometres. Capacity is eventually expected to reach around 4 million kilometres.
The Aditya Birla Group company's entry is expected to intensify competition in the retail wires and cables segment. Its focus on building a pan-India distribution and retail network has also raised concerns for established players.
However, the brokerage said Polycab's recent correction could present an opportunity rather than signal a major competitive threat. The stock declined over 12% in the five trading sessions following the Ultravolt launch.
The brokerage said the fast-growing wires and cables market has enough room for another meaningful player. The market is expected to expand at around 11%-12% annually.
Polycab derives around 70%-75% of its cables and wires revenue from cables. In comparison, Ultravolt's initial focus appears to be on wires and low-tension cables. This provides some protection to Polycab, as large power transmission and industrial cable projects often require two to four years of pre-qualification, creating higher entry barriers.
The brokerage also noted that the cables and wires industry operates at average operating margins of 10%-12% and net margins of 5%-7%. These margins are lower than those typically seen in branded paints, limiting the scope for sustained aggressive pricing by new entrants.
The brokerage expects Polycab to deliver a 22% PAT CAGR over FY26-FY29E, driven by volume growth and improving FMEG margins. It retained its annual capex estimate of around Rs 1,400-1,500 crore for FY26-FY29E.
Supply-chain disruptions, weaker demand and sharp copper-price volatility remain key risks, the brokerage said.
Polycab India (PIL) is India?s largest manufacturer of wires and cables and one of the fastest growing FMEG companies. It reported 33% rise in consolidated net profit to Rs 7,96.7 crore on a 39% increase in revenue to Rs 8,209.7 crore in Q1 FY27 over Q1 FY26.
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