Target: ₹1,976
CMP: ₹1,881.10
Havells India has informed the exchange about the commissioning of its new cable manufacturing facility located in Vasanthnarasapura Industrial Area, Tumakuru, Karnataka. This new facility, operational as of September 3, has a capacity of 3.48 lakh Kms with investment of ₹300 crore.
The company further plans to increase its Tumakuru capacity to 4.626 lakh Kms annually from 3.48 lakh Kms, which commissioned on September 3. This expansion is expected to be completed by Sep-2026, with a projected capex of ₹450 crore. The higher capex is due to the investment being directed towards enhancing capacity for higher size cables, specifically HT cables.
We view the capacity addition in the cable segment as a positive development for the company. However, the commissioning of the Tumakuru facility has been delayed by approximately six months, previously announced to be operational by Mar-2024. The W&C sector is projected to achieve a 13 per cent value CAGR over FY23-27, driven by strong demand from infrastructure and real estate. Havells’ W&C segment is anticipated to report an 18 per cent revenue CAGR over FY24-26.
The Tumakuru capacity expansion is expected to contribute to volume growth beginning in H2FY25. Additionally, the capacity additions in Tumakuru and Alwar are likely to benefit the company from FY27 onwards.
