Revenue
Margin
Demand
Guidance
Tone
Event Participants
Executives
3 Ashish Mangal, Govind Saboo, Murari Lal Poddar
Analysts
19 Balasubramanian, Disha Chhabria, Gaurav Gandhi, Jigar Jani, Kaustav Bubna, Kavina Desai, Kedar M Lepaxy, Khadija Mantri, Neha Garg, Nikhil Purohit, Nilabja Dey, Nitin Jain, Piyush Sevaldasani, Pragyam Ladda, Ravi, Rushit Shukla, Sonal Minhas, Sucrit D. Patil, Vidit Trivedi
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue | ~₹348.6 crores (implied from ₹38 cr EBITDA / 10.9% margin) | Highest ever Q1; up 33% YoY, driven largely by aluminium price pass-through with only 5-6% volume growth |
| Volume Growth | 5-6% YoY | Weaker vs. last year's high base (25-26% volume growth in Q1 FY26); customers postponed orders during the sharp March-May raw material price spike |
| EBITDA | ₹38 crores | Up 41% YoY, supported by improved operating leverage, favourable product mix, and continued cost discipline |
| EBITDA Margin | 10.9% | Improved YoY, reflecting enhanced operational efficiency |
| PAT | ₹25 crores | Up 37% YoY; no one-offs in the quarter |
| Order Book | ₹811 crores | As of June 30, 2026; only ~10% YoY growth due to weak April-May order booking industry-wide; provides near-term revenue visibility |
| Customer Mix | Govt 16% / Private 71% / Export 13% | Q1 FY27 revenue contribution; sustained demand across government and private sector projects |
| Product Mix | HV cables 68% / LV cables 30% / Conductor 2% | Q1 FY27 revenue contribution; conductor volume growth lagged cable growth |
| Solar Cables Share | ~20% of revenue | Expected to remain in a similar range for FY27; segment targeted to grow 25-30% for next 3-4 years |
| Capacity Utilization | ~85% | Existing facilities optimally utilized |
| Working Capital Turnover | >4x | Historical track record; supported by trade-term negotiations and improved credit rating for lower borrowing costs |
| New Plant Capex | ~₹45 crores | Commissioning from September 2026; historically asset turnover of 6-7x implies meaningful revenue potential at full ramp-up |
Geographic & Segment Commentary
- Domestic – Private & Government: Private sales contributed 71% of Q1 FY27 revenue and government 16%, reflecting sustained demand across power T&D, renewable energy, and industrial sectors. Management noted a healthy order pipeline backed by strong investments in transmission/distribution infrastructure.
- Exports: Exports contributed 13% of Q1 revenue; the US (entered this quarter) accounted for ~15% of export sales, with the balance from traditional markets in Asia, Southeast Asia, and Africa. Middle East/Gulf was negligible in Q1. The US is a license-driven, distribution-led market with long-term replacement demand.
- Product Segments: HV cables contributed 68% of revenue, LV cables 30%, and conductors 2%. Railway signalling has been temporarily held back due to margin pressure and intense competition; capacities are fungible and can be redeployed to other segments when market conditions normalize.
- Solar/Renewables: Solar cables contributed ~20% of Q1 revenue. Management remains bullish on solar parks and orders, expecting 25-30% segment growth for at least the next 3-4 years; a notable revenue share increase is visible only from FY28 as the new plant ramps.
Company-Specific & Strategic Commentary
- US Market Entry: First US supplies were dispatched in Q1 FY27 after 15-18 months of preparation, delayed by tariff barriers and policy uncertainty. Licenses are secured for HV/LV/MV cables; the distribution-led model supplies distributors who serve utilities/EPCs. Management highlighted huge replacement demand over the next 10-15-20 years, with even a small market share representing a multi-fold increase in TAM.
- Capacity Expansion – New Plant: The ~₹45 crore capex is progressing on schedule, with commissioning from September 2026. The plant introduces E-beam capability for the first time; meaningful revenue contribution is expected only from Q4 FY27, with 80-85% utilization targeted within 18 months and brownfield expansion scope available.
- Emerging Verticals – HTLS & Data Centers: HTLS conductors (technical tie-up with TS Conductor Corp) and data center power cables (not OFC/communication cables) are positioned as long-term growth plays. Most capex is fungible - existing machinery plus minor add-ons can serve these markets; current focus is on product development and customer engagement.
- Order Book & Commercial Strategy: Order cycles have shortened as customers avoid locking in elevated prices for projects 5-8 months out; only near-term orders (2-4 months) are being placed. Management continues to selectively choose business with favourable trade terms to protect margins and working capital.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Revenue growth | 18-20% long-term growth trajectory | No annual guidance given; quarterly growth will vary between price-driven and volume-driven, but the historical long-term trajectory is expected to be maintained |
| Solar cables share | ~20% of FY27 revenue | May increase in H2 as new plant ramps; notable increase visible from FY28; segment to grow 25-30% for next 3-4 years |
| New plant | Commissioning September 2026; meaningful revenue from Q4 FY27 | Ramp-up to 80-85% utilization targeted by end FY28 (~18 months); subject to market response |
| Volume growth | Expected to improve in coming quarters | Improvement contingent on raw material prices settling; global macro uncertainty remains a caveat |
Risks & Constraints
| Risk | Context |
|---|---|
| Raw material price volatility | Sharp copper/aluminium price increases (March-May 2026) drove order postponement and inflated inventory carrying value by 25-30% QoQ, raising debt. Mitigation: |
| Order book slowdown | April-May order booking was weak industry-wide as customers waited for price corrections; order cycle shortened to 2-4 months. Management does not expect material revenue impact given healthy dispatch momentum |
| Global macro and US tariff uncertainty | Geopolitical instability has shortened order sizes; US tariff barriers and policy uncertainty delayed market entry by 12-15 months - an ongoing risk for export scale-up |
| Competitive capacity expansion | All major cable players are expanding HV/EHV capacity; management views current competition as healthy, supported by secular T&D and renewable demand growth |
| Working capital intensity | Debt rose QoQ due to higher inventory values and back-to-back high revenue quarters; receivable days stable on a rolling six-month basis; working capital turnover maintained at >4x |
| New segment adoption timelines | Data center cable demand depends on macro factors outside company control; HTLS adoption requires utility-side approvals and alignment; building wire expansion restricted to B2B to avoid low-margin B2C competition |
| Customer captive backward integration | Adani and Birla groups - both B2B customers - are entering wires/cables; management sees limited impact given Birla's house-wire focus and the long approval process as a structural entry barrier for new entrants |
Q&A Highlights
Commodity Price Volatility & Margin Protection
- Question: With copper and aluminium prices volatile, how does the company protect margins if commodity costs remain high? (Sucrit D. Patil)
- Answer: Management uses two contract types - variable price contracts (
80%) with built-in price variation clauses that pass input cost changes to customers, and fixed price contracts (20%) where raw material is booked at order acceptance, protecting margins. This has been the company's operating model for years and mirrors industry practice. (Management)
Volume vs. Realization Growth Drivers
- Question: What was the volume vs. realization split in Q1 YoY growth? (Piyush Sevaldasani)
- Answer: Volume growth was only 5-6% YoY, with the balance driven by aluminium price increases. Last Q1's high base (25-26% volume growth) and customer order postponement during the March-May price spike explain the softness. Volume growth should improve as prices stabilize, though global uncertainty persists. (Management)
US Market Entry & Export Model
- Question: Can you elaborate on the US breakthrough, export geography breakup, business model, and margins? (Piyush Sevaldasani, Vidit Trivedi, Nitin Jain)
- Answer: First US shipments were made in Q1 FY27 after 15-18 months of preparation marked by tariff/policy delays. US was ~15% of exports; balance came from Asia, Southeast Asia, and Africa, with Middle East/Gulf negligible. The US is a completely distribution-led market - distributors supply utilities/EPCs. Initial margins are similar to domestic with potential incremental upside as a foothold is established; even a small US share would be a substantial long-term growth driver. (Management)
Capacity Expansion: Commissioning & Ramp-up
- Question: When will the new plant contribute, what is its revenue potential, and what is the ramp-up path? (Piyush Sevaldasani, Nilabja Dey, Jigar Jani, Nikhil Purohit)
- Answer: The ~₹45 crore capex is on track for September 2026 commissioning; meaningful revenue contribution is expected only from Q4 FY27. Historically asset turnover of 6-7x implies significant revenue potential at full ramp-up. Target is 80-85% utilization within 18 months (by end FY28), with brownfield expansion scope; E-beam capability is being introduced for the first time. (Management)
Order Book Slowdown & Revenue Visibility
- Question: Why is order book growth weak (~10% YoY) despite higher aluminium prices, and will it impact revenue? (Piyush Sevaldasani, Nitin Jain)
- Answer: April-May was a very weak order booking period industry-wide as customers were reluctant to lock in elevated prices for projects 5-8 months out; only near-term orders (2-4 months) are being placed. Order cycles have shortened but dispatch momentum remains healthy, so revenue booking should not be materially impacted. (Management)
Debt Increase & Working Capital Management
- Question: Why did debt rise QoQ despite similar revenue levels? (Sonal Minhas)
- Answer: Inventory carrying value rose 25-30% QoQ on higher raw material prices despite stable quantities; back-to-back high revenue quarters (March and June) also contributed. Debtor days are stable on a six-month rolling basis. The company optimizes working capital through trade-term negotiations and improved credit ratings for lower borrowing costs, maintaining >4x working capital turnover. (Management)
Growth Guidance & One-offs
- Question: Were there one-offs in Q1, and what is full-year guidance? (Ravi)
- Answer: No one-offs; growth came from substantial price increases. No annual guidance is provided, but the company has grown at 18-20% for the last 10-15 years and expects to maintain this long-term trajectory, with quarterly variation between price-led and volume-led growth. (Management)
Solar Cables Outlook
- Question: What is the FY27 guidance for solar cables revenue share? (Kedar M Lepaxy, Disha Chhabria)
- Answer: Solar cables were ~20% of Q1 revenue and should remain in a similar range for FY27; the share may increase in H2 with the new plant, with a more notable increase visible from FY28. The segment is expected to grow 25-30% for at least the next 3-4 years, driven by solar parks and solar orders. (Management)
HTLS Conductors & Data Center Cables
- Question: What is the opportunity and capital allocation strategy for HTLS conductors and data center cables? (Balasubramanian, Pragyam Ladda, Kaustav Bubna)
- Answer: Both are futuristic plays expected to mature over 3-5 years. Capex is largely fungible - existing machinery plus minor add-ons can serve these markets, so no substantial incremental investment is needed. For data centers, the company will supply power cables only (not OFC/communication cables); timelines depend on macros and customer guidance. HTLS can raise transmission load 2-3x on existing infrastructure, but broad adoption requires utility-side approvals and alignment. (Management)
Competition & New Entrants
- Question: Is pricing competition intensifying with industry-wide capacity expansion, and does Adani/Birla's entry into cables pose a risk? (Neha Garg, Gaurav Gandhi)
- Answer: All players are expanding, but demand is keeping pace and competition remains healthy, supported by multiple secular T&D and renewable growth levers. On Adani/Birla - Birla is focused on house wires, not power cables; Adani's business model is still to be watched. The long-duration approval process for power cable supply is a significant structural barrier for any new entrant. (Management)
Key Takeaway
Dynamic Cables delivered its strongest-ever Q1 in FY27 - revenue up 33% YoY to ₹348.6 crores, EBITDA up 41% to ₹38 crores (10.9% margin), and PAT up 37% to ₹25 crores - driven predominantly by aluminium price pass-through, as volume growth was only 5-6% YoY. The quarter's strategic highlight was first supplies to the US market (15% of exports) under a distribution-led model, complementing an ₹811 crore order book. A ₹45 crore capacity expansion remains on track for September 2026 commissioning, with meaningful revenue contribution expected from Q4 FY27 and 80-85% utilization targeted by end FY28, alongside first-time E-beam capability. Solar cables (20% of revenue) are targeted to grow 25-30% annually over 3-4 years, while HTLS conductors and data center power cables anchor the longer-term pipeline with minimal incremental capex. Management maintains its 18-20% long-term growth trajectory despite near-term order-cycle shortening. Key watch points: raw material price direction, order book re-acceleration as prices stabilize, and US reorder momentum.