HSBC has provided an optimistic outlook on the Cable and Wire (C&W) OEM sector, citing continued strong demand across all segments. The firm notes that while demand growth remains robust, volatility in copper prices and a high base are likely to pressure EBITDA margins for both Polycab and R R Kabel, while KEI Industries may see flattish margins.
For Polycab, HSBC retains its buy rating and has raised the target price to Rs 7,800, indicating a potential 10% upside from the current market price (CMP) of Rs 7,059.
KEI Industries maintains a hold rating, with the target price revised to Rs 4,350, showing a slight upside from the current market price of Rs 4,120.
HSBC also retains a hold rating on R R Kabel, with the target price at Rs 1,900, reflecting a moderate upside from its current market price of Rs 1,754.
Despite the challenges, the sector remains on solid footing due to strong demand momentum, although margin pressures may continue in the near term.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investors should consider consulting with a financial advisor before making any investment decisions.
