R R Kabel cuts FY27 volume outlook to about 14%-15%

R R Kabel Limited has cut its FY27 wires-and-cables volume-growth outlook to about 14%-15% from 16%-18%, following high-single-digit volume growth in Q2 FY27 and low-teens growth in H1 FY27. R R Kabel said industry growth drivers remain unchanged and management expects historically higher second-half volumes to support the revised plan.

Why did R R Kabel reduce its FY27 volume-growth outlook?

R R Kabel reduced its FY27 wires-and-cables volume-growth outlook to around 14%-15% because overall Q2 FY27 volume growth was in the high-single digits, below the low-teens rate reported for H1 FY27. Management cited quarter-to-quarter variation, including the monsoon season, and described the market as volatile, but did not identify a structural change in demand.

Wires grew in double digits in Q2 FY27, while cable volumes rose in single digits, causing wires to outpace cables in the period. Rajesh Jain, Chief Operating Officer, said the industry’s fundamental growth drivers had not changed and that R R Kabel remained positive on cable-capacity expansion undertaken for its growth plans.

Management continued to identify infrastructure development, power and electrification, housing and industrial investment as long-term supports for the wires-and-cables industry. Its comments also included global uncertainties and evolving market dynamics as factors to watch, while maintaining a 14%-15% FY27 volume-growth plan.

Can R R Kabel achieve 14%-15% volume growth in FY27?

R R Kabel said it remains confident of delivering around 14%-15% wires-and-cables volume growth in FY27, with H2 expected to account for a greater share of annual volumes than H1. Management said H2 has historically recorded higher year-on-year volumes and that its plan incorporates the higher comparative base.

An analyst said that the full-year target could imply high-teen growth in H2 FY27, based on low-teens H1 growth, but management did not endorse a specific second-half percentage. Instead, it reiterated the 14%-15% full-year range and gave no separate Q3 FY27 or Q4 FY27 volume guidance.

Exports grew faster than domestic sales in Q2 FY27, while wires outpaced cables on volume growth. R R Kabel said exports historically represented 25%-30% of revenue and were moving towards about 35%; management added that most recent export growth came from cables after new capacity eased earlier constraints.

How did R R Kabel's wires-and-cables business perform in H1 FY27?

R R Kabel's wires-and-cables revenue rose 55% year on year to about Rs 5,890 crore in H1 FY27, while segment profit increased 78% to around Rs 568 crore. Segment profit margin expanded to 9.6% from 8.4% in H1 FY26, alongside low-teens volume growth.

In Q2 FY27, wires-and-cables revenue was about Rs 3,010 crore, up 53% year on year, and segment profit was about Rs 282 crore, up 57%. The segment profit margin increased to 9.4% from 9.2%, while total company operating earnings before interest, tax, depreciation and amortisation, or EBITDA, margin rose to 8.7% from 8.1%.

Management attributed the H1 FY27 wires-and-cables margin improvement to higher gross profit, disciplined commodity management, operating-cost absorption and operating leverage. It also said higher raw-material prices and product mix affected Q2 gross margin, while commodity-price movements can influence both sales realisations and margins.

What are R R Kabel's margin and investment plans?

R R Kabel retained its wires-and-cables earnings before interest and tax, or EBIT, margin target of 9.5% for FY27 and about 10.5% for FY28. H1 FY27 segment profit margin was 9.6%, but management did not raise the FY27 target and said its three-year margin-improvement guidance remained unchanged.

Management said planned FY27 capital expenditure was Rs 550 crore to Rs 600 crore and that execution remained on track. This budget excludes the board-approved Rs 200 crore investment for land acquisition in Rajasthan, which management called the first step towards a new capital-expenditure plan; most payment may occur in FY27, with some potentially in H1 of the following year.

Net working capital improved to 46 days in September 2026, from 49 days in March 2026 and 50 days in June 2026. Management said it expected the measure to remain in a 45-50-day range and reported about Rs 1,290 crore of letter-of-credit-backed trade facilities, reflecting greater use for metal purchases as commodity prices rose.

How do FMEG and UM Cables fit into R R Kabel's plans?

R R Kabel retained its objective of breaking even at the fast-moving electrical goods, or FMEG, segment EBIT level for full-year FY27. FMEG revenue grew 35% year on year to about Rs 562 crore in H1 FY27, while the segment loss narrowed to about Rs 12 crore from about Rs 19 crore and the loss margin fell to 2.2% from 4.5%.

In Q2 FY27, FMEG revenue increased 42% to about Rs 274 crore, supported by appliances and new products, but the segment recorded a loss of about Rs 12 crore. Management said seasonal effects usually result in muted Q2 demand, after FMEG had reached break-even in Q1 FY27.

On September 25, 2026, R R Kabel signed an agreement to acquire the optical-fibre and related-cables undertaking of UM Cables Limited for about Rs 77 crore, subject to post-closing adjustments and conditions precedent. The transaction was not recognised in September 2026 results, and management said the plant had low capacity utilisation and that a detailed plan would be provided by the next quarter.

Conclusion

R R Kabel's revised 14%-15% FY27 volume target reflects a slower Q2 volume rate, particularly in cables, rather than a disclosed change in sector fundamentals. The revision comes as H1 wires-and-cables revenue rose 55% to Rs 5,890 crore, segment profit grew 78% to Rs 568 crore and segment profit margin increased 120 basis points to 9.6%.

The next indicators are whether H2 FY27 volume growth delivers the revised annual plan, whether cable growth improves with additional capacity in domestic and export markets, and whether FMEG reaches annual EBIT break-even. Management also plans to disclose a detailed plan for UM Cables by the next quarter while executing Rs 550 crore to Rs 600 crore of FY27 capital expenditure and the Rajasthan land acquisition.