Dynamic Cables - Much more dynamic in 2022?

[NAMAN_PARMAR]

The $5 Copper Shock: The 4 Forces Pushing Copper to Record Highs Right Now

• Tariff Fears: The U.S. government is considering imposing new tariffs on copper imports, which is driving buyers to stockpile copper before the potential price increase. Traders are reacting by sending copper into the U.S. to take advantage of higher prices.
• High U.S. Demand: U.S. copper prices are higher than the global prices, which is attracting copper from other regions, particularly Asia and Europe, to take advantage of the price premium in the U.S.
• Decreasing Copper Exports from Chile: Chile, the world’s largest copper exporter, has been facing challenges, including labor unrest and lower copper ore grades. This has led to a decline in its copper exports, tightening global supply.
• China’s Increasing Demand: China’s copper demand is rebounding, leading to an increase in copper purchases, which is further tightening the global copper supply.

But Dynamic Cable will have no impact because 80% of the raw material is aluminium and 20% is copper and all increase in the price is fully passed on that’s why they are able to maintain the margin of 10% over last 4-5 quarters.

[kartik_bhat]

Q4 FY 25 Performance highlights

Business Performance

• Revenue growth was 37% for Q4 on YoY basis and 32% on Qoq basis. Healthy Operating Cash flows of 56 cr
• Highest ever annual revenue of 1000+ cr
• Business mix: Pvt sales 73% , Govt sales 18% and exports 9%
• Product mix –
  • HV cables –57%
  • LV cables – 36%
  • Conductor 7%
• Order book 726 cr
  • 70% is from power utilities.
  • 15% is from solar / renewables
  • 8 to 10% is from Govt discoms
• Strong demand scenario – order book has grown QoQ, was at 670 cr in Q3 FY 25
• Improvement in working capital cycle
• Govt business is down from 23% to 17% this FY. – resulting in better working capital cycle.
• Have also been moving to large corporate clients gradually over last 3-4 years, thereby working capital cycle likely to improve gradually
• FY 25 ROCE and ROE was 26% and 22% respectively
• Debt levels down from 119 cr to 59 cr – mainly short-term debt
• US market: Received one product approval. Two more product approvals in pipeline: likely to receive in this FY. Waiting for more clarity on tariffs, before pursuing more aggressively.

Capex & Revenue Potential

• Capacity expansion (35 to 40 cr) which was announced earlier likely to be operational by start of H2 FY 26. Asset turns of about 5 to 6. Will look for optimum utilization at the earliest
• Looking to diversify portfolio in HV and speciality cables segment
• Have vacant land parcel (15,000 sq m) near to existing plant – which can be utilized for additional capex if needed.
• Policy has been to grow through set of incremental capex rather than doing 1 big capex

New Products

• Started with solar cables in existing plant.
• Launched Speciality conductor (Electronic Beam technology) in the market

Business outlook

• Maximum revenue potential considering new capacity - 1400 to 1450 cr
• Margin trajectory has remained consistent at 10 to 10.5% over last 4-5 years. Will look to sustain this going forward.
• Export demand –
  o Pitching to markets like USA, Australia – mainly power and renewables segments. Lot of spends happening in power infrastructure.
  o Replacement of their old grid – likely to result in huge demand coming up in next few years.
  o Sizable contribution to revenue in FY 27
• Do not see signs of any degrowth or demand slowdown for cables sector for next 5 years – strong demand in renewables, power, etc

Disc: Invested with a tracking position

[prabal_jain]

What I didnt understand was mgmt told we can do maximum 1150-1200 with current capacity. But they did 331 in this Q4 which translates to 1300 cr annualized. Does that mean they had some spillover of order from past quarter which were ready but revenue got booked this quarter ?

Rest looks like a very good story in making.

Disclosure - invested.

[prchou83]

@prabal_jain

What I didnt understand was mgmt told we can do maximum 1150-1200 with current capacity. But they did 331 in this Q4 which translates to 1300 cr annualize

Management highlighted in the call that generally Q4 is the best quarter for them and also for other cable companies and lot of delivery offtake do take place in last Q of financial year. That explains the uptick in Q4.
Also , 1400 to 1450 cr estimate for next year does look reasonable for next year as new capacity which will be operational by H2 have a revenue potential of 200 to 250cr . Can assume it could add 80-100 cr this year.

[prchou83]

A very encouraging announcement from company

ca4f7387-85fb-4df6-ad6d-94dca530f12e.pdf

Blockquote
Capacity Reassessment:
In continuation of our debottlenecking initiatives and incremental capex at the existing
plant over the last 6 months, and as per the latest management assessment, the company’s
production capacity can now support a turnover of upto Rs.135 Crores per month, an
increase from previous assessment of upto Rs.100 Crores. The utilization of the above
revenue potential shall depend upon product mix, orders in hand and delivery schedules
which vary from month to month.

Market seems to have taken this news quite positively. With this it seems 1500cr might not be far away for FY26.
Disc: Holding, added some in correction in last 30 days.

[Bibin_ponnachan]

Has anyone gone through their rpt they have given corporate guarantee worth 344 crores to indokrates pvt ltd…

!!!

[Tushar_Gupta1]

Dynamic Cables Q2FY26 Result Analysis and Concall notes

• Customer Wise Contribution:

• Government: 12%
• Private: 78%
• Exports: 10%

• Product Mix (Revenue)

• HV Cables: 55%
• LV Cables: 37%
• Conductors: 8%

• Order Book as on 30 Sept 2025 – 721 Cr which gives visibility of 7-8 months of revenue.

• Due to monsoon temporary slowdown in new orders inflow.

• Current capex are 15 Cr for Debottlenecking majorly incurred in last year and 34 Cr green field expansion with 6x Asset turn will be complete by H2 FY26.

• This will take the full capacity to 1600 Cr levels post expansion.

• Capacity utilisation will be more or less 85-90% of total capacity.

• Company has fully repaid long term borrowing; current debt is for working capital needs.

• Solar cables contribute 10-15% of total revenue, TAM of this vertical is 6000-7000 Cr, Company is targeting higher revenue from existing customer in this segment. Post expansion management has a plan to take this segment to 20% of revenue.

• Smart Metering distribution cables contributes around 10% of Revenue, with a growing execution this will going to grow.

• Wires and Cables required by BESS and Data Center are at very nascent stage company is doing working of these products. For Data Center some R&D had already done.• Exports contribute 10-12% of topline, US approval delayed because of Tariffs.

• There is long term opportunity for Extra HV Cables but company doesn’t considering this segment in near term.

• Margin Guidance of 10.5% for long term.

• Revenue Growth Rate will be 20% which is 1.5x of industry growth.

• New Capex will be announced post current capex completion.

[rohit_agarwal1]

2 Big news:

1. The company has received the UL 854 Certification from UL Solutions which will help them sell in United States.
2. They have received approval from
   Power Grid Corporation of India Limited for the manufacturing & supply of ACSR & AL59
   (upto 61 strands) conductors for its manufacturing plant situated at Reengus.

Dynamic Cables has validated its recent Capex and cleared the entry barriers for both the biggest buyer in India (PGCIL) and the biggest market in the world (USA).

[prabal_jain]

Indokrates is 53 year old company by the same promoter (not a subsidiary but a related party) - https://www.zaubacorp.com/INDO-KRATES-PVT-LTD-U29299RJ1972PTC001426

So as per above, it doesnt seem like a problem.
Anyone has any other view on this?

[Tushar_Gupta1]

DYNAMIC CABLES Q3 FY26 RESULTS

[Tushar_Gupta1]

CONCALL NOTES OF Q3 FY26

[Arash_Mishra]

[SahilPatani]

Flattish/subdued Q4 results, when other cable companies have reported healthy double digits topline and bottom line growth numbers. Punished badly 20% LC rather on an overall negative day. Would be interesting to see why they weren’t able to grow as much as their peers.

[TKarthik]

I noticed there is a confusion as to when the new production capacity goes live. The con call mentions Sep 2026 versus the PPT/transcript says Sep 2027. Did we receive any clarification about this?

[Siddharth_Krishna]

It’s September 26. Capacity will come live in H2FY27 (Oct ‘26 - Mar ’27)

[ilovestockmarket]

I guess we might see EPS in range of 22-23 and with a conservative 20+ PE .. stock should behave accordingly.. hopefully this capex gets started by Sept without any delay .. stock has been beaten in last 6 months due to capex delays and weak quarter… hopefully good times ahead

[TKarthik]

Thanks for the reply, Sir! Can you please confirm the source of this information? I noticed the discrepancy between the con call transcript and the powerpoint slides presented. Based on the photos shown in the powerpoint it is hard to believe that the factory will start production in 3 months. Can you please elaborate? Thanks again.

[Siddharth_Krishna]

You can hear the concall recording