The KEI growth outlook remains at more than 25% revenue growth for FY27, despite sales rising about 31% in the first half. In its October 22, 2026 earnings update, the wires and cables manufacturer outlined a Sanand expansion timetable extending into 2027, while CFO Rajeev Gupta said working capital limits how quickly available production capacity can translate into sales.
Key Takeaways
- Management retained its FY27 revenue growth target of more than 25%, citing working-capital constraints.
- Second-quarter sales rose 38.52%, but net profit grew more slowly and the net profit margin narrowed.
- Sanand Phase 2 is targeted to begin commercial production by March 2027, with EHV sales ramping later after approvals.
Table of Contents
- KEI growth outlook reflects working-capital limits
- Domestic sales lead growth, while profit margins diverge
- Sanand commissioning and sales approvals are separate milestones
- Conclusion
KEI growth outlook reflects working-capital limits
Gupta said working capital does not support revenue growth beyond roughly 25%–30%, explaining why management retained a more conservative full-year target despite stronger first-half growth. The company also reiterated its expectation of a 20% compound annual revenue growth rate over the next three to four years.
KEI lists the September-quarter earnings-call recording in its corporate announcements for the period ended September 30, 2026. Gupta’s discussion distinguished available manufacturing capacity from the funding needed to carry inventory and execute additional business.
Inventory increased by approximately INR1,200 crore during the first half. Gupta attributed INR600–700 crore of the build to stocking the new Sanand factory during its ramp-up, with the balance reflecting copper-price valuation. Management expects inventory days to return to earlier levels of about 90 days of cost of goods sold by March 2027.
KEI said it was debt-free, with cash and bank balances of INR698 crore at September 30, including INR169 crore remaining from its qualified institutional placement. That liquidity provides flexibility, but management’s comments show that a debt-free balance sheet does not remove working-capital constraints.
| Item | Details |
|---|---|
| Wire and cable order book | INR4,927 crore. |
| First-half cable capacity utilization | 77%. |
| Cumulative Sanand capital expenditure | INR1,876 crore. |
| Dealer and distributor sales share | 59% in Q2; management expects a 55%–60% range. |
| EPC wind-down | INR8 crore Q2 loss; management expects INR5–7 crore losses for another one or two quarters. |
Domestic sales lead growth, while profit margins diverge
Second-quarter net sales reached INR3,776 crore, up 38.52% year on year. Domestic wire and cable sales rose 46% to INR3,184 crore, while exports increased more modestly to INR493 crore from INR472 crore.
Profit after tax rose 28.96% to INR262.45 crore, slower than revenue, and the net profit margin declined to 6.95% from 7.46%. EBITDA increased 28.69% to INR401 crore, with a margin of 10.62%. Separately, the reported operating margin edged up to 9.97% from 9.88%.
Gupta attributed quarterly margin movements to inventory valuation adjustments and emphasized the first-half figures: the EBITDA margin reached 11.73%, compared with 11.46% a year earlier. He reiterated an approximately 11% EBITDA margin target for FY27, with a potential move toward 11.5%–12% as Sanand ramps up.
Export orders stood at about INR991 crore, with the United States accounting for almost half. Gupta said export orders typically take three to four months to execute. The backlog therefore represents business awaiting delivery, rather than revenue already recognized.
Sanand commissioning and sales approvals are separate milestones
Management expects Sanand Phase 2, covering extra-high-voltage and high-tension cables, to begin commercial production by the end of March 2027. EHV sales from the plant are expected to ramp up from the September 2027 quarter after approvals.
Gupta estimated that the new EHV capacity could add INR1,500–1,700 crore of revenue potential beyond the existing approximately INR700 crore. Peak utilization is expected in FY29, so the capacity estimate should not be read as an immediate revenue forecast.
KEI paid INR402 crore in capital expenditure during the first half, including INR333 crore for Sanand. Management plans annual capital expenditure of approximately INR600 crore for the next three to four years, including INR100–150 crore of maintenance spending.
Conclusion
The next scheduled milestone in KEI’s expansion plan is Sanand Phase 2 commercial production by the end of March 2027. Inventory normalization is targeted for the same period, while the later EHV approvals and sales ramp will determine when the additional capacity begins contributing more meaningfully to revenue.
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