HSBC slashes targets for 4 stocks after UltraTech’s entry in wires and cables. Time to cut losses?
HSBC slashed target prices for India’s leading wires and cables companies by as much as 23% on Thursday, citing competitive risks from UltraTech Cement’s surprise foray into the industry. The brokerage said UltraTech’s Rs 1,800 crore investment could be an “industry-fragmenting” event, weighing on long-term earnings growth for incumbents.
Polycab India, KEI Industries, and R R Kabel bore the brunt of the revisions, with HSBC cutting their target prices by 20-23%. Polycab’s target was slashed to Rs 6,250 from Rs 7,840, KEI Industries to Rs 3,450 from Rs 4,500, and R R Kabel to Rs 1,260 from Rs 1,600. Havells India saw a smaller 7% reduction, with its target lowered to Rs 1,730 from Rs 1,850. The brokerage maintained its ‘buy’ ratings on Polycab, Havells, and R R Kabel but kept KEI Industries at ‘hold’.
UltraTech, India’s largest cement producer, announced its entry into the wires and cables segment, aiming to commission a plant in Gujarat by December 2026. HSBC said UltraTech’s established relationships in the construction sector and supply chain advantages—particularly through its sister company Hindalco’s aluminium and copper business—could make it a formidable competitor.
In Thursday’s trading, concerns over rising competition weighed on other wires and cables companies, with Havells India and PolyCab India tumbling 6.3% and 18.8%, respectively. KEI Industries and R R Kabel saw steeper declines, plunging 21% and 20%, respectively. UltraTech itself slumped 5% to its lowest level since June, as investors
