(Reuters) -India’s R R Kabel reported a 39.4% rise in its first-quarter profit on Thursday, driven by strong demand for its wires and cables.
The company reported a consolidated net profit of 897.7 million rupees ($10.25 million) for the quarter, compared to 643.8 million rupees a year ago.
Sales in its wires and cables segment, which makes up 89% of overall revenue, grew about 16% year-on-year.
KEY CONTEXT
India’s largest wires exporter saw robust demand, both in the domestic and international markets, driven by strong construction activity in sectors such as power transmission and real estate.
Its domestic wires business garners among the highest margins for the company, analysts have said.
R R Kabel is ramping up its manufacturing capacity in the smaller cables segment as deep-pocketed new entrants UltraTech Cement and Praneetha Ecocables — backed by business conglomerates Aditya Birla Group and Adani Group – enter the industry.
PEER COMPARISON
Valuation (next 12 Estimates Analysts’ sentiment
months) (next 12
months)
RIC PE EV/EBI Price/S Revenue Profit Mean # of Stock to Div
TDA ales growth (%) growth rating* analyst price yield
(%) s target** (%)
R R Kabel Ltd RRKA. 37.20 23.15 16.35 29.47 Buy 9 0.94 0.49
NS
Polycab India Ltd POLC. 39.63 26.89 3.68 18.85 22.03 Buy 29 0.92 0.50
NS
Havells India Ltd HVEL. 52.25 33.99 3.88 11.06 15.73 Buy 28 0.87 0.65
NS
KEC International KECL. 20.82 11.85 15.27 55.41 Buy 21 0.87 0.63
Ltd NS
* The mean of analyst ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
** The ratio of the stock’s last close to analysts’ mean price target; a ratio above 1 means the stock is trading above the PT
APRIL TO JUNE STOCK PERFORMANCE
— All data from LSEG
— $1 = 87.5540 Indian rupees
(Reporting by Ananta Agarwal in Bengaluru; Editing by Mrigank Dhaniwala)
