Company: V-Marc India
Sector: Electrical Wires & Cables
Exchange: NSE Emerge (SME)
Basic Details
• Market Cap: ~₹1,650 crore
• Issue Price: ₹36-39
• Current Price: ~₹520 (as of Jan 2026)
• Listing Date: April 2024
Financial Highlights
• Revenue (Latest FY – FY25): ₹905 crore
• Net Profit (FY25): ₹36.4 crore
• ROE: 24.3%
• Debt-to-Equity: 1.07×
• Revenue Growth (3-year CAGR): ~39%
Capacity Utilization
- High current utilization: V-Marc’s FY25 production of ~1.69 lakh km indicates very strong capacity utilization, effectively running at full stretch versus its earlier installed capacity, reflecting robust demand and execution.
- Expansion underway: Management is aggressively expanding capacity (targeting ~7 lakh km over the next 4–5 years), which should ease utilization pressure and support sustained volume growth.
Business Overview
• What they do:
The company is a leading manufacturer of electrical wires and cables, serving residential, commercial, and infrastructure projects across India. It offers a comprehensive product portfolio that includes housing wires, power cables, control cables, and specialized application cables, catering to both mass and premium segments. With a strong emphasis on quality, safety, and compliance with industry standards, the company has built a trusted brand among electricians, contractors, and developers. Its brand-led distribution model, supported by an extensive dealer and distributor network, ensures deep market penetration and repeat demand, while continuous product innovation and capacity expansion position it well to benefit from long-term growth in housing, electrification, and infrastructure spending.
• Key Products/Services:
– LV wires and cables
– HT XLPE cables up to 33kV
– Power cables for infrastructure and DISCOMs
– Value-added and specialty cables
• Market Position:
Mid-sized fast-growing player competing with organized peers such as Polycab and KEI; gaining share through product premiumisation and capability upgrades.
• Key Customers:
Real estate developers, contractors, infrastructure players, and government DISCOMs (tender-based).
Management Quality
• Promoter Background:
Promoted by Vikas Garg; long operating history in the wires & cables segment with a recent technology-led business turnaround.
• Promoter Holding: ~64.9%
• Pledged / Encumbered Shares: ~43.2% of promoter holding
• Key Management:
Professional second line supported by capacity expansion, execution-focused operations, and institutional oversight post listing.
Investment Thesis
Positives
• Technology-led turnaround with commissioning of Gas Cured CCV (dry curing) facility enabling HT XLPE cables up to 33kV
• Strong operating momentum with 100% YoY revenue growth in H1 FY26 and management guiding for stronger H2
• Robust five-year CAGR: PAT 49% | Sales 39%
• Healthy return ratios: ROCE 26%, five-year average above 15%
• Capacity expansion roadmap: from 1.69 lakh km (FY25) to 7 lakh km over five years
• Favorable industry tailwinds with Indian wires & cables industry expected to grow at 12–13% CAGR
• Valuation comfort: PEG ratio of ~0.66; stock trades near 24× P/E despite strong growth visibility
• Marquee investor confidence: Ashish Kacholia holds ~2.71% stake
Concerns
• SEBI manipulation probe against promoter (Feb 2024); confirmatory order (Jul 2024) impounding ~₹6.3 crore; matter sub-judice at SAT
• High raw material volatility (copper, aluminium, PVC) impacting margins despite partial hedging
• Competitive pressure from large organized peers may keep margins range-bound
• Capacity ramp-up risk if order inflows do not scale in line with planned expansion
• High finance cost and fund-based limits operating at 86–91% utilisation
• Promoter share encumbrance remains elevated
Valuation
• P/E Ratio: ~24× (trailing)
• Forward P/E (FY26E): ~13.5×
• P/B Ratio: ~4.5×
• EV/EBITDA: ~13–14×
• Compared to peers:
V-Marc trades at a discount to larger peers on forward multiples despite faster growth, improving product mix, and higher operating leverage potential.
Growth Catalysts
• Execution of ₹510 crore order book, including higher-margin HT cable orders
• Capacity expansion and utilization ramp-up over FY26–FY28
• Increasing participation in government DISCOM and infrastructure tenders
• Margin improvement from operating leverage and premium product mix
Red Flags to Watch
• Outcome of SEBI/SAT proceedings involving promoters
• Sustained high promoter share pledge
• Working capital stretch during aggressive capacity expansion
• Sharp adverse movement in copper and aluminium prices
Conclusion
V-Marc India represents a high-growth SME manufacturing play that has undergone a meaningful technology-led turnaround. Strong H1 FY26 performance, expanding order book, and a multi-year capacity expansion roadmap provide clear growth visibility.
We estimate FY26 PAT at ₹110–120 crore, implying a forward P/E of ~13.5× at current levels. Applying a normalized 25× P/E, the implied FY26 market capitalisation is ~₹3,000 crore, versus the current ~₹1,650 crore, offering meaningful upside as execution consistency and governance comfort improve.
Disclosures
Mandatory: I am not invested in the stock, it is an unbiased research.
Disclaimer
SME stocks carry higher risks due to smaller scale, limited operating history, and relatively relaxed regulatory requirements. This analysis is for educational purposes only and should not be considered investment advice. Please conduct your own due diligence or consult a SEBI-registered financial advisor before investing.