UltraTech’s Entry Into Wires Market Triggers Selloff In Polycab, KEI Industries, RR Kabel Shares
Shares of leading wires and cables manufacturers came under pressure on September 4 after UltraTech Cement announced the launch of its new Ultravolt business, raising concerns about increased competition in a market dominated by established companies. KEI Industries witnessed the steepest decline among major players, falling 8.25% to ₹4,855 during morning trade. Polycab India dropped 6.22%, while…
On September 4, shares of top wires and cables manufacturers faced a selloff following UltraTech Cement's announcement of its new Ultravolt business. The market shift raised concerns over heightened competition in an industry already dominated by established companies. Among major players, KEI Industries plummeted by 8.25% to ₹4,855, Polycab India experienced a 6.22% drop, while RR Kabel saw a 4.8% decline.
Other companies such as Finolex Cables, Havells India, and Universal Cables also traded lower. Conversely, UltraTech Cement shares rose nearly 2% as investors welcomed the company's entry into the sector. UltraTech Cement, a part of the Aditya Birla Group, has pledged ₹1,800 crore to establish its wires and cables business. Ultravolt, launched ahead of schedule, aims to become one of India's two leading wires and cables corporations within five years.
Initially, the company will manufacture wires and low-tension cables at its Jhagadia facility in Gujarat. Expanding its reach across more than 500 districts and 6,000 pin codes, UltraTech plans to support its growth through over one lakh retailers, 5,000 UltraTech Building Solutions outlets, and more than 20 warehouses. By targeting the second-largest wires player by capacity at launch, UltraTech demonstrates its ambitious growth strategy.
Analysts remain optimistic about UltraTech's expansion, with brokerages maintaining positive outlooks for the company's move. Morgan Stanley retained its 'Overweight' rating with a target price of ₹14,700, praising UltraTech's strong execution and prompt launch completion. RR Kabel Q1 profit surged to ₹205.2 crore and revenue reached ₹3,168.2 crore.
Jefferies also maintained its 'Buy' rating with a target price of ₹14,065, highlighting UltraTech's more aggressive entry into the market than initially anticipated.
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