Polycab Eyes Q2 Support From Copper-Led Buying as Competition Intensifies

Polycab India is entering the September quarter with a mix of supportive and challenging factors. Rising competition in the wires and cables market following UltraTech Cement’s entry through Ultravolt could increase competitive pressure, while firm copper prices and the possibility of advance inventory purchases ahead of price revisions may support Polycab’s Q2 FY27 performance. The company remains the largest organised player in the segment, with an estimated 30-31 per cent market share.

Ultravolt Adds Competitive Pressure

UltraTech Cement launched Ultravolt on September 3 after committing Rs 1,800 crore to the business. The venture has started commercial production at its Jhagadia facility in Gujarat, which has a capacity of 10.98 lakh km of house wires and light-duty cables. Ultravolt plans to establish a pan-India presence covering more than 500 districts and 6,000 pin codes.

Ultravolt is initially focusing on wires, which could limit its immediate impact on Polycab’s broader portfolio. Cables account for roughly 70-75 per cent of Polycab’s wires and cables mix. Industrial and power-transmission cables also have higher entry barriers, with certain products requiring around two to four years of pre-qualification. This could make it more difficult for new entrants to quickly gain share across the entire cables market.

Copper Prices Could Support Q2 Revenue

Higher copper prices could provide support to Polycab’s September-quarter revenue. As the cost of copper rises, dealers may increase purchases ahead of potential price revisions by manufacturers. Such pre-buying, particularly towards the end of the quarter, could support sequential volumes.

A similar commodity-led effect was visible in Q1 FY27, when Polycab’s consolidated revenue increased 39 per cent year-on-year to Rs 8,210 crore. The wires and cables segment contributed 87 per cent of revenue, while fast-moving electrical goods accounted for 9.2 per cent. The remaining revenue came from the engineering, procurement and Construction business.

However, underlying volume growth in the wires and cables segment remained in the low-to-mid single digits. Consolidated EBITDA margin declined by 70 basis points to 13.8 per cent, partly due to softer exports. A recovery in exports could therefore provide some support to profitability.

For Q2 FY27, margins are expected to remain broadly flat or improve slightly sequentially, although they could remain below the year-ago level.

Q2 Volumes and Margins in Focus

Polycab’s Q2 FY27 results will provide a clearer indication of whether higher copper prices translated into stronger underlying volumes. Investors will also track margins, export performance and the company’s response to increasing competition in the wires market.

Polycab’s cables-heavy portfolio currently provides some insulation from the immediate competitive push in wires. The key test for the company will be whether it can convert healthy revenue growth into stronger underlying volumes while maintaining profitability as competition intensifies.

Disclaimer: The article is for informational purposes only and not investment advice.