Cable Stocks Crashed; Polycab, RR Kabels, Havells, KEI Fall Up To 15%; Why Adani Is The Reason?

Cable Sector Stock crashed: Shares of KEI, Polycab, RR Kabels, Havells, and other wires, cable sector stocks nosedived on Thursday after Adani Enterprises announced its entry into the segment. Most of the cable sector stocks fell by over 15% today.

Adani Enterprises on Wednesday announced that its wholly owned subsidiary Kutch Copper Limited has completed the incorporation of Praneetha Ecocables Limited.

Adani Group announces entry into cables industry segment

With the acquisition, Adani Group's entity, KCL, will now hold 50% equity share capital of the joint venture company with PEL, as per the company's stock exchange filing.

"We would like to inform that Kutch Copper Limited ("KCL"), a wholly owned subsidiary of the Company has completed the incorporation process of a joint venture company namely "PRANEETHA ECOCABLES LIMITED" ("PEL") on 19th March 2025 (confirmation of the same has been received by the Company on 19th March, 2025 at 2:34 pm IST) with Praneetha Ventures Private Limited, KCL shall hold 50% Equity Share Capital of PEL," the company said in a BSE filing on Wednesday.

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The Adani Group joint venture will be involved in manufacturing, marketing, distribution, buying and selling of metal products, cables and wires.

Cable sector stocks crash on Thursday

A day after Adani Group confirmed its entry, several cable sector stocks were down by over 15% on Thursday. KEI Industries share price was down 14.55 per cent intraday low of Rs 2,802.10 per share . Whereas, Polycab India shares closed 6.59% lower at Rs 5083.35 apiece on BSE today. Havells India shares ended 3.51% lower at Rs 1502.70 per share on Thursday.

Ultratech Cement's entry into cable sector segment

The recent plunge in cable sector stocks followed a similar trend when Ultratech announced its foray into the wires and cables industry in February. Aditya Birla Group's flagship company Ultratech Cement, announced its entry into the wires and cables business with a Rs 1,800 crore investment.

The company, in February, shared its plans to set up a manufacturing plant in Gujarat by December next year. The announcement weakened investors' sentiment towards cable sector stocks in February.

Will the cable sector stock crash continue?

"Last month, we witnessed a sharp correction in wires and cables stocks like Polycab, KEI Industries, Havells, and RR Kabel, with some names plunging over 20% in a single day. A similar downtrend is seen today, with stocks reacting negatively to the Adani Group's entry into this space. It is important to recognize that markets tend to overreact to news, sometimes to an unjustifiable extent. We have seen this pattern play out in the past with various other sectors and companies," said Gaurav Goel - Founder-Director- Fynocrat Technologies, underlining that an announcement by an entity into a business doesn't translate into immediate sales.

He also called the present situation as an attractive opportunity for investors to invest in fundamentally strong stocks. "These deep corrections often present attractive opportunities for investors to accumulate fundamentally strong stocks with competent management. In many instances, corrections drive valuations to extremely compelling levels," noted Goel.

"We remain optimistic about Polycab, KEI Industries, and Havells, given their strong fundamentals and leadership positions in the industry," he added.

"The Adani Group's entry into the cables and wires segment, following Ultratech's recent announcement, signals rising competitive intensity as deep-pocketed players look to capture market share through aggressive pricing. This raise concerns over margin pressures, likely leading to valuation de-rating across the sector.

In the near term, stocks like KEI Industries, Polycab India, RR Kabel, Finolex Cables, and Havells India may face continued selling pressure as markets factor in these risks. Additionally, the sharp rise in both copper and aluminium prices - key raw materials used in cables & wires - has pushed costs to multi-month highs, further weighing on near term outlook," said Satish Chandra Aluri, Lemonn Markets Desk.