You highlighted 40% domestic volume growth - what would have been industry growth and where is your market share trending now?
It's very difficult to provide market share perspective at this stage, given that we are the first one in the industry to announce our results and others are yet to report. Once the remaining larger players publish their numbers, we will have better visibility in terms of exact market share gains. In terms of performance, we've seen very strong volume growth as well as value growth. However, it would be premature to currently comment on the market share until the other companies come out with their results.
Strategically you have not passed through all commodity inflation to protect demand - if copper and aluminium continue moving up, could there be temporary demand curtailment?
It's very difficult to comment on commodity prices. However, from a demand perspective, we are very confident that the growth momentum will continue. We are seeing healthy traction across government and private capex as well as the real estate sector, with significant investments flowing into power utilities and infrastructure. From that perspective, we do not see demand as a challenge for us.
Q-on-Q, generally Q4 is bigger than Q3 - should sequentially margin be better than Q3 with better operating leverage?
Yes, it should definitely get better. In Q4, as far as the gross margin level is concerned, to the best of our ability, we will try and pass on whatever price hikes are required to be done to the end customers. We are not sure whether copper prices will continue to move up or go down. Whatever the mix, we will try and pass on whatever it is to the end customer as much as possible.
On cables acceleration from 20%+ to 40% volumes - which segments saw the most uptick? And given 80% of sales are through distributors, wouldn't they upstock cables also when copper/aluminium go up?
Distributors are kind of servicing institutional demand - they stock based on when projects require specific cable shipments. Cables are significantly bulkier and more expensive than wires, so distributors have a limit to capital availability. Generally, even though cables are sold through distributors, we don't see distributors stocking up cables - this is largely a wires phenomenon, not cables. On segments, since we don't directly supply to end customers, we don't have full visibility on which sectors are generating what kind of demand. We will be able to give better guidance on sector-driven demand during the Q4 call on a yearly basis.
Price hike during quarter is almost 70-80% of commodity reaction - is it fair to assume minimum 10-15% overall price hike?
You can compute the commodity inflation which was there in the past quarter, along with the rupee depreciation, and just give a multiple of 75% to 80% to that. More or less you'll get the amount of pass-through.
Strong revenue growth in the C&W segment - would you be able to quantify what is the volume growth for this quarter YoY?
For both domestic cables and wires, our volume growth is about 40%.
Any more detail on which end-user industries contributed higher, because 40% is significantly higher?
We have witnessed sustained momentum in both government and private capex. The real estate sector, particularly in the top 7 cities, has seen healthy levels of launches and sales, closely tracking with previous decadal highs. We are also seeing a recovery in affordable housing segment. Additionally, due to the commodity price inflation, there has been some channel stocking happening for wires, which has also contributed to the higher surge in top-line.
On EBITDA margin - high volume growth should result in operating leverage, and you took a price hike of about 6% YoY. What exactly led to the fall of EBITDA margin both YoY and Q-o-Q?
The primary reason has been the sharp rise in commodity prices. From January 2025 till January 2026, copper in rupee terms has risen almost 50% and aluminium almost 25%. In this quarter alone, 22% inflation happened in copper price compared to previous quarter. We took a conscious call to pass it on in a staggered manner - while we have been revising prices, the full impact of input cost increase has not yet been passed on. Most of the decline in EBITDA margins has been at the gross margin level. The high top-line growth has resulted in operating leverage which is very much visible below the gross margins. We believe similar to FY22, margins may take a hit for a quarter or two but should recover gradually.
What is the quantum of price hikes that you have taken at the start of this quarter?
The total price hikes that we would have taken within this quarter will be almost 75% to 80% of whatever commodity inflation was there.
On exports - while there has not been a degrowth, how do you foresee exports to shape up in coming quarters? And why is the U.S. weak this quarter - is it tariff related?
On exports, the majority of revenue accrued during this quarter has come from geographies other than U.S. As and when orders from U.S. come in, they will further add to the revenues. We have seen strong performance in regions such as Middle East, Latin America. Overall, all geographies are contributing meaningfully, and we have a healthy order book. Yes, the U.S. weakness is tariff related - this remains a global overhang impacting players worldwide, not just in India. We are currently awaiting a final resolution on this matter.
Can you give some sense of breakup between performance within Wires and Cables separately?
Typically, our mix of cable and wires is in the ratio of 70-30. However, in this particular quarter, we've seen wires growth outpace cables growth, leading to a marginal increase in wires share by a few percentage points. Additionally, in value terms, the growth in wires would be higher, largely due to significant increase in copper prices.
On price hike - how much in previous quarter, how much in current quarter starting January, and how much still needed to make up commodity inflation?
We've passed on almost 75% to 80% of the commodity inflation which was there during the quarter already within the quarter. The remaining will happen during this quarter. The January hike has been taken partially and we will further pass on further increase in prices gradually.
Some colour on the distributor side - how much of demand is restocking versus consumer driven?
Restocking is largely happening on wires rather than cables. Distributors typically maintain roughly 30 days of inventory, but at the end of the previous quarter or beginning of this quarter, channel inventory was in the range of around 40 to 45 days - so around 10 to 15 days of additional inventory. Demand is pretty strong, with very good secondary and tertiary sales happening. Even in the last 3-4 quarters, every quarter we've seen similar pre-stocking because commodity prices continuously go up, yet every successive quarter we see improvement in growth rate. Q4 should be another good quarter as executions are at peak.
How does your capacity utilization stack up currently?
Our capacity utilization in the quarter was in the early 80% range.
On institutional sales which outperformed distributor sales - can you quantify in percentage terms?
Generally, our mix of distribution versus institutional sales is around 90:10. But this time around institutional sales had grown faster than distribution sales, hence it would have improved by about a couple of hundred basis points.
On real estate contribution for the wire which has also outperformed - more colour on that?
In top 8 cities, both number of launches and volume of sales has been quite robust in 2024, and the same momentum is continuing in 2025. We've been talking for a couple of quarters now that while we have seen majority of positive demand on the premium side, recent data also suggests pickup happening on the affordable side. We had introduced the Etira brand to compete with unorganized players in Tier 3 to 5 cities, with very good growth happening there. Even in Tier 1, Tier 2 cities, our focus has been more on Class 2 wires where we are seeing market share gains.
Can you give colour on the volume growth split between wires and cables out of the 40% W&C volume growth?
For us in domestic business, the volume growth has been around 40%. Both cables and wires have grown at pretty much similar pace in terms of volume. In case of revenue, since wires are copper-based and copper has seen more inflation, wires growth at revenue level was 70%, whereas for cables, the growth was around 50%.
On cable segment - call out top 3-4 sectors driving sales growth. What is contribution of Power T&D?
Major consumption at product category level happens in power cables, control cables, which largely go to power infrastructure and utility infrastructure - that's the primary demand sector. Followed by strong growth in the industry segment. Manufacturing, utility, government - all have picked up good demand. Power T&D contribution for us is almost 30%. At industry level, around 40% to 45% of cables sold are low voltage and medium voltage cables, followed by control cables (15-20%) and flexible cables (10-15%).
Could the customer have done significant restocking such that Q4 numbers may be slightly negatively impacted because of massive destocking if copper prices don't move much?
Restocking has been largely in case of wires. Typically, cables do not see any significant stocking, and we continue to see uptick in real estate. Historically, similar event occurred in FY22 where after one or two quarters, subsequent quarters continued to show growth momentum. There is a bit of elevated inventory on wires, but since demand itself is pretty strong, we are quite confident there won't be any slowdown in momentum in Q4. Q4 is generally the peak when cable demand is highest.
On ad spend which is considerably higher and almost 3x of quarterly ad spends - is this the new run rate?
This is the time of the year when festive activity is higher, particularly in second half of the year, when we make a conscious call to step up brand building investments including celebrity associations - this is a strategic call. As far as run rate is concerned, we've guided that we want to spend around 3% to 5% of B2C top-line every year on A&P. Even with this increased spend this quarter, we are hardly at around 1.5% currently. Going ahead we can definitely see increased investments in A&P, but quarterly variations happen with second half being heavier on A&P.
Profitability is linked to percentage margins, right, and not some specific rupees per tonnage?
Yes, your understanding is correct. To refer to our Project Spring guidance, we've given a long-term guidance of 11% to 13%. But in the near term, yes, what you mentioned is correct. It's not rupees per ton - it's percentage annualized.
On cable and wire margins - is the one-off employee cost booked in any specific segment? And on the 300 bps margin impact from unfavourable product mix - is that largely higher institutional sales?
It's not in a specific segment - it's across. On margins, there are three to four key factors. First, due to copper price inflation, we've staggered our pass-through. Second, there has been an unfavourable business mix change wherein institutional business has grown faster than channel business. Third, contribution from exports has marginally declined. In last year Q3 exports contribution was about 8.3%, whereas in this quarter it is at about 6%, so even within quarter-on-quarter comparison, the contribution has gone down.
If copper/aluminium prices continue up 40-50% YoY for next 2-3 quarters, do you see any impact on demand given budgets will take a hit?
We have zero control over commodity prices and therefore it is difficult to comment. There continues to be uncertainty around price movement, which is beyond one's control. However, from a demand perspective, visibility in the coming quarter and the quarter thereafter remains strong, and we continue to see healthy momentum. So we don't see any difficulty with respect to demand. Absolutely not seeing any impact of such a steep increase in the commodity price on the demand for the next 2 quarters.
On margins - we carry close to ₹6,000 crores worth of inventory, in a rising price scenario wouldn't that benefit initially? How does the inventory cycle play out?
We hedge our inventory. Our pricing is not at the time of procurement but is done at a future time once we have an order for that inventory. So while we have been carrying higher inventory levels, inventories are not priced - they will get priced in the future. This is something we've followed for over a decade for stability of margins. We don't see scenarios of inventory gains or inventory losses just because we price it at a future date. The higher inventory we are maintaining is because we are anticipating good demand for Q4, similar to Q2 end which played out well in Q3.
What's the margin profile for institutional sales, retail sales and exports?
Margins in exports are definitely much higher compared to domestic margins - generally we've been making at least around 15% of EBITDA margins in our exports. In domestic sales for cables, generally we make anywhere between 9% to 12% of EBITDA margins. In wires, it is between 15% to 16%. There are quarterly variations depending on commodity prices and demand.
On FMEG fans business - how has it shaped up given regulatory headwinds and commodity prices? And on solar - current revenue run rate, EBIT margin?
On fans, initial uptake during the quarter was pretty low because summer this year was softer and channel inventory was getting liquidated in October-November. December saw a small uptick because of BEE transition from January 1. Overall fans industry would have been largely flattish or small degrowth, and our performance was in line with industry. New BEE norms imply 2-4% price hikes during Q4. On solar, it had another very good quarter after 1-1.5 years of strong momentum. We expect Q4 to be very strong. We launched a new range of 350-kilowatt solar inverters last quarter which did very well. The margin profile of solar is currently in high single digits and we are maintaining that. Solar is now the largest category for us in FMEG and is one reason FMEG has become profitable. We will continue to improve FMEG profitability towards the guided range of 8% to 10% by FY30.
We grew 59% in domestic C&W and would have gained market share - what would the market growth be? Upwards of 50%, 40%?
Getting exact market growth for this quarter will be very difficult at this point as we'll have to wait for other larger listed companies to come out with their results over the next 2-3 weeks. But growth would have been higher in this quarter than first half. To the best of our estimation, in first half of this year, industry growth was around 15% to 16%. I believe industry would have been more closer to 20% at least (including organized plus unorganized). With our 59% growth, we have gained a lot of market share. In spite of 300 bps decrease in margin, we delivered 34% profitability growth in this segment on the back of 59% domestic growth. In first half we had grown cables and wires at 26% YoY versus industry growth of around 16%, whereas in this quarter we've grown at around 60%.