Orient Cables plans 40% cable capacity rise with IPO funds

Orient Cables plans to use Rs 91.50 crore of IPO net proceeds for machinery, equipment and civil works that would raise annual cable capacity from 895,776 km to 1,255,296 km, a 40.1% increase. The project would also raise annual piece capacity from 50.40 lakh pieces to 1.73 crore pieces, subject to installation, commissioning and implementation.

How much cable capacity will Orient Cables add?

Orient Cables plans to add annual installed capacity of 359,520 km and 1.22 crore pieces at Unit II in Bhiwadi, Rajasthan. The installed-capacity base of 895,776 km and 50.40 lakh pieces was measured as of June 30, 2026, while the proposed additions and post-expansion totals are stated on an annual basis.

The capacity expansion would take kilometre capacity to 1,255,296 km and piece capacity to 1.73 crore pieces. Kilometre capacity would increase 40.1% from the June 2026 base, whereas piece capacity would increase 242.9%, indicating that the proposed machinery is expected to add substantially more unit-based output than cable length.

Orient Cables says the figures cover its manufacturing base rather than a single product category. Its four stated segments are Networking Cables and Solutions; Specialty Power, Optical Fibre Cables and Solutions; Wire and Cable Harness Assemblies and EV Charging Guns Cable Assembly; and Other Allied Products, which include passive networking equipment.

How will Orient Cables use Rs 91.50 crore for capacity expansion?

Orient Cables has allocated Rs 91.50 crore from net proceeds for capital expenditure on machinery, equipment and civil works at its manufacturing facilities. Its board approved the allocation on September 10, 2026, while the company proposes a fresh issue of up to Rs 320 crore and has separately earmarked Rs 155.50 crore for repayment or prepayment of borrowings.

The vendor quotations identified for the capital project total Rs 99.79 crore, which is Rs 8.29 crore above the IPO-funded allocation. Orient Cables says the balance, as well as any rise in quotations, would be funded from internal accruals and future debt from lenders; quoted costs may change because of raw-material prices, taxes, duties, foreign-exchange rates and incremental charges.

The allocation is not yet supported by purchase orders. As of the red herring prospectus date, Orient Cables had not deployed funds, placed orders or entered definitive agreements for the listed machinery and equipment, and it says the eventual suppliers may differ from the quoted vendors. The proposed capacity rise therefore depends on fundraising, final vendor selection and the availability of supplementary funding if costs exceed the allocation.

Which machinery will support Orient Cables' new output?

Orient Cables' largest listed machinery costs are Rs 17.21 crore for six composite automatic extrusion machines, Rs 17.10 crore for two electron-beam accelerator machines and Rs 13.03 crore for 48 high-speed bunching machines. Extrusion applies insulation or sheathing to wire, electron-beam processing treats materials, and bunching twists multiple wires together, making all three equipment groups central to cable production.

The project also includes machinery for cable protection, forming, drawing, testing and finishing. Orient Cables lists a 48-bobbin armouring machine and a 3+1 core-laying machine at Rs 1.50 crore each, a 1,600/2,240 mm drum twister at Rs 3.80 crore, and laboratory equipment for electrical, mechanical, flame, chemical, visual and environmental tests.

Several purchases identify prospective products beyond bulk cable output. A Rs 2.31 crore automated assembly machine is intended for CAT-6a keystone jacks, which are networking components, while a Rs 2.15 crore automatic line would cut, crimp and solder solar-cable pieces to diodes for solar junction boxes. A Rs 3.45 crore local area network, or LAN, cable measuring system is specified to test cable parameters up to CAT-8 standards.

Civil works are required because the two 3.0-megawatt electron-beam reactors need specialised foundations and handling systems meeting Atomic Energy Regulatory Board requirements. Orient Cables has a Rs 6.90 crore quotation for those works and separately lists Rs 2.06 crore for irradiation-crosslinking cable equipment; it introduced e-beam technology in Fiscal 2025.

When will Orient Cables deploy the expansion funds?

Orient Cables plans to deploy Rs 3 crore of the Rs 91.50 crore capital-expenditure allocation in Fiscal 2027, Rs 50 crore in Fiscal 2028 and Rs 38.50 crore in Fiscal 2029. Fiscal 2028 accounts for 54.6% of the planned allocation, making it the largest scheduled year for the expansion spend.

The timetable is an estimate rather than a fixed commitment. Orient Cables says spending may move into a later fiscal if utilisation is incomplete, citing the timing of the offer, market conditions, board assessment of economic trends, business requirements, project implementation, required approvals and availability of financing as variables.

Orient Cables reported capital expenditure of Rs 1.55 crore for the three months ended June 30, 2026, equal to 3.17% of revenue from operations. Its capital expenditure was Rs 7.22 crore, or 6.16% of revenue, in Fiscal 2026; Rs 807.31 crore, or 9.79%, in Fiscal 2025; and Rs 1.68 crore, or 2.56%, in Fiscal 2024, so the proposed Rs 91.50 crore allocation exceeds the Fiscal 2026 and Fiscal 2024 additions but not the Fiscal 2025 amount reported in the prospectus.

What conditions could change the planned expansion?

Orient Cables states that the post-expansion capacity totals are conditional on successful installation, commissioning and implementation of its plan. The company also says its machinery quantities are based on management's current estimates, while final costs may be revised for taxes and levies after the quoted amounts.

The company has said that a shortfall in net proceeds or an increase in utilisation requirements could be funded with internal accruals or future lender debt. As of June 30, 2026, total outstanding borrowings were Rs 258.46 crore, including Rs 240.43 crore of secured fund-based facilities, and the proposed Rs 155.50 crore debt repayment allocation is scheduled for Fiscal 2028.

The expansion is also dependent on the execution of a vendor programme whose quotations were valid for six months from September 2026. Orient Cables confirms that its promoters, directors and key managerial personnel have no interest in the entities from which it obtained the quotations, but it does not identify final suppliers or signed procurement contracts.

Conclusion

Orient Cables has set out a defined manufacturing expansion: Rs 91.50 crore of net IPO proceeds is earmarked for equipment and civil works, with annual cable-length capacity projected to rise 359,520 km, or 40.1%, and annual piece capacity projected to increase by 1.22 crore pieces. The equipment list links the expansion to cable extrusion, bunching and electron-beam processing as well as networking and solar-junction-box assembly.

The next development to watch is whether Orient Cables converts its September 2026 quotations into definitive orders and follows the Fiscal 2027 to Fiscal 2029 deployment schedule. The prospectus leaves final vendor selection, final prices, installation timing and the need for internal accruals or future debt to cover the Rs 8.29 crore gap between quotations and the IPO allocation unresolved.