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RR Kabel - Wired For Better Future: Prabhudas Lilladher Initiates Coverage With A 'Buy'

We believe RR Kabel is a play on several opportunities in the wires and cables segment.

<div class="paragraphs"><p>(Image source: company website)</p></div>
(Image source: company website)

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Prabhudas Lilladher Report

We initiate coverage on RR Kabel Ltd. with a ‘Buy’ rating and target price of Rs 1407 valuing at 35 times FY25 earnings. We believe RR Kabel is a play on several opportunities in the wires and cables segment given-

  1. strong brand with diverse product portfolio,

  2. well-structured capacity expansion plans,

  3. increasing dealers /distribution network and

  4. distribution led export business.

Although the company has grown its fast moving electrical goods portfolio inorganically, yet it expects to minimise losses in coming years by transitioning towards premium markets. In FMEG, too, RR Kabel has enhanced its brand presence, positioning and manufacturing capabilities to minimize losses.

We estimate revenue/Ebitda/profit after tax compound annual growth rate of 20.7%/38.8%/44.3% over FY23-26 led by-

  1. improving business mix,

  2. operating leverage and cost optimisation,

  3. investments in brand building and

  4. increasing distribution reach.

Click on the attachment to read the full report:

Prabhudas Lilladher RR Kabel Initiating Coverage Note.pdf
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