Major Wires and Cables Stocks Plummet Following UltraTech’s Announcement
On Thursday, February 27, shares of leading wires and cables manufacturers took a significant hit after UltraTech Cement revealed its plans to enter the sector. Market leaders such as KEI Industries and Polycab India saw their stock prices tumble by 15%, while RR Kabel experienced a 13% decline on the National Stock Exchange (NSE) by 10:00 am. Additionally, Havells India and Finolex Cables recorded losses of 7.47% and 4.96%, respectively. The sudden drop in stock values reflects investor concerns over increased competition in the industry.
UltraTech Cement’s Strategic Expansion and Investment Plan
UltraTech Cement, a subsidiary of the Aditya Birla Group, has announced a major expansion into the wires and cables segment, backed by an investment of ₹1,800 crore over the next two years. The company plans to leverage its well-established manufacturing capabilities and extensive customer base to deliver high-quality products. The manufacturing facility is set to be built near Bharuch, Gujarat, and is expected to commence operations by December 2026. This move aligns with UltraTech’s broader strategy of diversifying its portfolio and strengthening its presence in the construction materials sector.
The company aims to cater to the rising demand for wires and cables across residential, commercial, industrial, and infrastructure applications. The sector has shown consistent growth, with a revenue compound annual growth rate (CAGR) of approximately 13% between the financial years 2018-19 (FY19) and 2024. As the industry transitions from unorganized to organized markets, the outlook remains optimistic.
Aditya Birla Group Chairman Emphasizes Growth Strategy
Kumar Mangalam Birla, Chairman of the Aditya Birla Group, highlighted the rationale behind the company’s expansion, stating, “We aim to broaden our footprint within the construction value chain by entering the wires and cables sector. This initiative aligns with our vision to provide end-to-end solutions for our customers while maintaining our commitment to the core cement business.”
UltraTech Cement has also achieved a new milestone by surpassing 175 million tonnes per annum (mtpa) of cement production capacity in India. The company is poised to become the largest cement manufacturer globally, excluding China. Birla reaffirmed UltraTech’s commitment to delivering top-quality building materials and solutions, contributing to the sustainable development of India’s evolving infrastructure landscape.
