The Adani Group has made a bold move into the cables and wires business, sending shockwaves through the cables and wires industry! On March 19, 2025, Adani Enterprises’ subsidiary, Kutch Copper, partnered with Praneetha Ventures to form a joint venture called Praneetha Ecocables Limited. This new entity will focus on manufacturing, selling, and distributing metal products, cables, and wires.
For Adani, this marks a significant diversification step, building on its existing strengths in cement, copper, and infrastructure. However, this entry has left existing players in the sector rattled. Let’s dive into the details – could this industry be gearing up for the next big boom?
Cables and Wires Industry: The Current Players in the Industry
India’s cables and wires market is valued at around ₹75,000-80,000 crore and is growing rapidly. The sector is dominated by major players like Polycab India, Havells India, KEI Industries, Finolex Cables, and RR Kabel. These companies hold significant sway in the organized market – Polycab commands 20% of the cables segment, KEI holds 12%, Havells has 8%, while in wires, Finolex leads with 15% and RR Kabel follows with 12%. These firms have relied on strong branding, extensive distribution networks, and quality products to maintain their positions. But Adani’s arrival has sparked widespread concern.
The market’s reaction was immediate – on March 20, when news of Adani’s move broke, share prices of these companies took a hit. KEI Industries saw a steep 14% drop, Polycab fell by 9%, and Havells slipped 5-6%. Clearly, the market sees Adani’s entry as a potential game-changer.
Why Are Existing Players Afraid?
The fear surrounding Adani’s entry isn’t baseless – here’s why it’s causing a stir:
- Financial Muscle and Scale: Adani is a conglomerate with deep pockets and vast resources. It can invest heavily in large-scale manufacturing, set up plants, and adopt aggressive pricing strategies. This poses a major threat to smaller and mid-sized companies that may struggle to compete in a price war against such a giant.
- Synergies with Existing Businesses: Adani already operates in infrastructure, cement, and copper smelting (with a $1.2 billion project in Mundra). The cables and wires business aligns perfectly with these sectors. By leveraging its existing distribution networks and raw material supply chains, Adani could gain a cost advantage that competitors can’t easily match.
- Track Record of Aggressive Expansion: Look at Adani’s history – it acquired Ambuja and ACC in the cement sector, made waves in airports, and now it’s stepping into cables. This is a group that enters industries with an eye on domination. Existing players worry that Adani could eat into their market share.
- Raw Material Advantage: Copper and aluminum, key raw materials for cables, are already expensive. Adani’s copper business could secure in-house supplies, while competitors remain dependent on volatile market prices. This cost disparity could squeeze their margins further.
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Will There Be Mergers and Takeovers?
Adani’s entry raises the likelihood of consolidation in the industry. Experts suggest that smaller companies, especially those in the unorganized sector or with weaker positions, could become takeover targets. Adani is reportedly planning acquisitions in the $500-700 million range, a strategy it successfully employed in cement. Firms like Universal Cables, Cords Cable Industries, or Plaza Wires could find themselves in Adani’s crosshairs if it opts for aggressive takeovers.
Bigger players like Polycab, KEI, and Havells have strong brands, but if Adani triggers a price war, they might consider mergers or partnerships to protect their margins. Social media buzz on X suggests that “M&A activity will pick up” as competition turns into a survival game.
Is This the Sector Where the Next Boom Will Happen?
The cables and wires industry in India is seeing robust demand, driven by the power sector (especially renewables), real estate, infrastructure projects, smart cities, and rural electrification. The market is growing at a 9-11% CAGR, making it a fundamentally strong sector with room for new entrants. Earlier, the Aditya Birla Group announced a ₹1,800 crore investment plan through UltraTech Cement, and now Adani has joined the fray. The arrival of two major conglomerates signals that this could indeed become a hotspot for action.
However, this boom won’t benefit everyone equally. If supply outpaces demand, oversupply could pressure margins. Analysts predict a tough short-term phase for existing players, though the sector’s long-term growth potential remains intact. Giants like Adani and Birla can play a thin-margin game and absorb losses to grab market share – a luxury smaller players don’t have.
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What’s Next?
Adani’s foray into cables and wires is a game-changer. The sector is now a battleground where competition, pricing, and innovation will dominate. Existing players will need to step up – either by strengthening their distribution and branding or exploring M&A to stay afloat. For investors, this is a volatile phase, with stock prices still under pressure.
So, is this the next boom sector? Yes, judging by demand and growth trends, it certainly has the potential. But the real winners are likely to be big players like Adani. For smaller firms, it’s a do-or-die moment. Keep your eyes peeled and watch the market closely – the action has only just begun!
