RR Kabel Bets Big on B2B Cable Business with Rs. 1,200 Crore Capex Under Project RRise, Targets Margin-Led Growth Amid Record FY26 Financial Performance

RR Kabel Bets Big on B2B Cable Business with Rs. 1,200 Crore Capex Under Project RRise, Targets Margin-Led Growth Amid Record FY26 Financial Performance

RR Kabel Ltd is accelerating its transformation into a higher-margin, institution-focused electrical products company through a Rs. 1,200 crore capacity expansion programme, an increased focus on the B2B cable business and continued premiumisation of its Fast-Moving Electrical Goods (FMEG) portfolio, while reporting record revenue and profitability in FY26.

The Electrical Post:

Mumbai: RR Kabel Limited is accelerating its next phase of growth through Project RRise, with a strategic focus on margin expansion, capacity augmentation, premiumisation and strengthening its B2B portfolio, according to Managing Director Mahendrakumar Kabra in the company's FY 2025-26 Annual Report.

Describing FY26 as a year of rapid acceleration and disciplined execution, Kabra said the company focused on fully leveraging its operational foundation while structurally improving margins and reinforcing its market position. Rather than merely transitioning, RR Kabel concentrated on scaling operations, enhancing profitability and preparing the business for its next growth phase.

Under its strategy titled "Powering the Next Phase," the company is shifting from broad-based market expansion to targeted, margin-accretive execution. This includes re-engineering its product mix to increase the share of the B2B institutional cable business, maximizing manufacturing utilisation, and ensuring that every capital expenditure delivers measurable returns. Alongside operational improvements, RR Kabel is investing in renewable energy, automation and specialised internal capabilities while strengthening its distribution network to expand its presence in under-penetrated markets.

The strategy translated into strong financial performance during FY26. The company reported total revenue of Rs. 9,722 crore, registering a 27.6% increase over the previous year, driven by substantial volume expansion in its core Wires & Cables business. The company achieved higher double-digit cumulative volume growth in the segment and expects to maintain the growth momentum going forward.

Profitability improved significantly during the year. EBITDA increased 61.8% to Rs. 789 crore, while Profit After Tax rose 58% to Rs. 492 crore. According to management, the improvement was supported by a better product mix, enhanced operating efficiencies, pricing discipline and the benefits of scale across the Wires & Cables business.

Project RRise also delivered on its margin expansion objectives. EBITDA margin improved from 7.4% in FY25 to 8.9% in FY26, reflecting the operating leverage generated through higher scale and disciplined execution. The company expects margins to improve further as the project progresses over the coming years.

RR Kabel reported year-end inventory of Rs. 1,771 crore, primarily due to higher sales in transit caused by shipping disruptions in the Middle East during the latter part of the financial year. Management stated that the elevated inventory reflects strong international demand and ongoing execution of export orders rather than any slowdown in business. The timing difference is expected to normalize over the coming quarters.

A key element of the company's long-term strategy is rebalancing its Wires & Cables business by increasing the contribution of cables within the overall product mix. Management believes the B2B cable market offers longer-term contract visibility, stronger institutional relationships and more predictable cash flows than the predominantly retail-driven wire segment.

The increasing demand for cables resulted in high utilisation levels across manufacturing facilities during FY26, prompting the company to begin executing the first phase of its Rs. 1,200 crore capital expenditure programme planned over three years. The initial investment was deployed during FY26 at the Silvassa and Waghodia manufacturing facilities through modular expansion projects designed to match rising demand.

According to the company, the modular approach enables capacity additions every six months, allowing investments to remain closely aligned with market demand while protecting Return on Capital Employed by avoiding idle capacity. Management expects these investments to contribute meaningful incremental revenue once fully operational.

RR Kabel continues to operate 5 world-class, integrated manufacturing facilities across Waghodia, Silvassa, Roorkee, Bengaluru, and Gagret. To support its ambitious B2B and export growth, the Company plans to execute an INR 1,200 Crore modular Capex plan over a 3-year period. Notably, a major part of this annual investment was directed towards expanding cable capacities. By adding capacity in a phased, modular manner, the Company ensured optimal utilisation throughout the fiscal year.

While the Wires & Cables business continued to drive strong volume growth, RR Kabel adopted a different strategy for its Fast-Moving Electrical Goods (FMEG) business. In an environment of subdued discretionary consumer demand, the company prioritised profitability over volume growth by focusing on premium and mid-premium product categories.

Approximately 25% of the company's FMEG revenue now comes from premium and mid-premium products. To further strengthen this portfolio, RR Kabel expanded its RR Signature range in April 2026 by introducing mixer grinders, electric cooktops, hand blenders, industrial air coolers and semi-commercial air coolers. The company believes these additions will increase consumer engagement while positioning the brand beyond traditional electrical products.

The expansion also aligns with the growing adoption of energy-efficient electric cooking solutions. Management expects the FMEG business to achieve EBIT-level break-even during FY2026-27, supported by continued premiumisation and improving margins.

Looking ahead, RR Kabel intends to maintain its strategic focus on expanding manufacturing capacity, strengthening its B2B portfolio and sustaining margin improvement under Project RRise. Management believes disciplined capital allocation, operational efficiency and product portfolio optimisation will continue to drive long-term growth and profitability.

Exports: The export segment continued to play a vital role in the Company’s revenue profile, contributing approximately 26% to total turnover in FY 2025-26. In a dynamic global trade environment shaped by geopolitical developments and evolving logistics conditions, the segment continued to perform with consistency, supported by proactive customer engagement, agile supply chain management and strong execution discipline.

RR Kabel manufactures and markets wires, cables and fast-moving electrical goods for residential, commercial, industrial and infrastructure customers across India and more than 66 countries. Its Wires & Cables portfolio includes house wires, industrial wires, power cables, specialty cables and solar cables, while its FMEG portfolio comprises fans, lighting products, switches, switchgear, appliances and kitchen appliances. The company also operates a fully integrated manufacturing model, producing its own insulation and sheathing compounds to maintain quality control from formulation through production.
 

Published at : Sep 08, 2026 10:18 AM (IST)

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