KEI Industries Ltd

<dhhead>Message from Chairman-cum-Managing Director</dhhead>

Wiring the intent and impact

Dear Shareholders,

It is a privilege to present our second Integrated Annual Report for

FY 2024-25. This year is better defined by our strategic expansion, operational resilience, and sharper market focus. We continued to deepen our capabilities, strengthen our product line, extend the geographical reach, and invest in long-term enablers across manufacturing, distribution, and innovation. As we scale up in line with India’s infrastructure and energy transformation, I am pleased to share our performance highlights and outline our priorities for sustained, future-ready growth.

The year unfolded amid shifting global currents. While major economies grappled with elevated interest rates and uneven recovery paths, India stood out for its macroeconomic stability and sustained momentum. According to Government estimates, the Indian economy grew by 6.5% in FY 2024-25, supported by strong infrastructural activity, industrial capex, and a resilient services sector. In contrast to the caution visible in global trade and private investment, India’s growth story remained anchored in domestic demand and policy-led infrastructure buildout.

The wires and cables industry – accounting for nearly 39% of the country’s electrical equipment sector

benefited directly from this momentum. With an expected CAGR of 11-13% through FY 2028-29, the market is projected to reach Rs. 1,20,000 crore, fueled by the expansion of power networks, urban infrastructure, housing, and data connectivity. Exports, too, have been on the rise, doubling over five years to reach Rs. 16,765 crore in FY 2023-24, with continued growth in the current year.

This backdrop played to KEI’s strengths.

Our diversified product portfolio ranging from housing wires to EHV places us at the heart of India’s development story. We also strengthened our global linkages, scaling up exports and building on our technological and manufacturing edge.

FY 2024-25 was a year of well-rounded growth and disciplined execution for KEI Industries. We reported a 19.89% increase in revenue, reaching Rs. 9,736 crore, with a three-year CAGR of 19%. Our EBITDA rose 19.88% to Rs. 1,063 crore, maintaining a stable margin of 10.92%, while PAT grew 19.85% year-on-year to Rs. 696 crore, with margin consistency at 7.15%.

Return ratios remained robust, with ROCE at 25% and ROE at 16%, reflecting healthy capital efficiency.

Despite front-loaded capital expenditure of Rs. 698 crore during the year, we sustained a comfortable debt profile net debt to EBITDA at 0.2x. Our ability to manage leverage while investing in future capacity reinforces our reputation as a financially prudent organization.

This financial strength was further validated by leading credit rating agencies. CARE Ratings, India Ratings and Research and ICRA Limited upgraded our long-term rating to AA+ (Stable), and re-affirmed A1+ for short-term borrowings. These ratings reflect our consistent servicing record and strong balance sheet fundamentals.

In November 2024, we completed a Rs. 2,000 crore

Qualified Institutional Placement (QIP). This fund raising was to part finance setting up a Greenfield manufacturing facility for LT, HT and EHV Cables at Sanand, Ahmedabad, Gujarat and repayment/ pre-payment of outstanding debts and for general corporate purposes.

FY 2024-25 underscored the strength of KEI’s well-balanced business model, with growth driven by our core segments – Retail, Institutional, and Exports – while we continued to streamline and stabilize our EPC and support divisions.

Our retail business sustained its strong growth trajectory, contributing 52% to total sales, up from 46% in the previous year. This performance was powered by demand for wires and cables in the real estate and rental markets. A strengthened dealer ecosystem – with 2,082 active dealers as of March 2025 and wider channel financing adoption (covering ~60% of B2C sales) helped deepen market reach and improve receivables management. Our retail strategy remains focused on expanding scale to strengthen brand positioning across geographies –driven by growth of over 35% during the last year.

Domestic Institutional sales contributed 35% for the full year, despite project-side execution bottlenecks in the EHV segment due to Right of Way delays. While EHV cable sales declined temporarily, capacity was efficiently redirected towards medium and high-voltage power cables, resulting in 27% annual growth in total domestic institutional cable sales. The order book remains robust, supported by healthy demand from renewable energy, industrials, and infrastructure segments such as metro, rail, and data centers.

Export sales grew by 15% to Rs. 1,267 crore, driven by a sharp 40% rise in cable exports, reflecting deeper penetration in the Middle East, Australia, and the newly entered US and European markets. Certification milestones like UL (US) and BASEC (UK) are enabling access to larger orders, with an export order book of Rs. 701 crore as of April 2025. We expect exports to contribute 15-18% of total sales over the period of next 3 years, with the Sanand facility unlocking long-length EHV export capability in Q1 FY 2026-27.

In line with our stated strategy, we scaled down non-cable EPC operations to Rs. 343 crore from Rs. 562 crore last year. This measured reduction is aimed at limiting exposure to execution delays while maintaining operational continuity for project close-outs, warranty management, and payment recoveries. Debtors from EPC projects have already reduced meaningfully, and future sales activity will be in the range of 4-5% of turnover.

Our stainless-steel wire division remained stable with annual sales of Rs. 212 crore and 89% capacity utilization.

As India consolidates its position as a reliable manufacturing hub, global demand for LT, HT, and EHV cables is gaining momentum – driven by renewable energy transitions, urbanization-led infrastructure, and the shift to smart grids. This outlook, reinforced by the China Plus One strategy, positions KEI to lead across domestic and global growth corridors. With retail enhancing brand salience, institutional and export verticals capturing high-value opportunities, and a disciplined EPC footprint, we are scaling with precision – ready for the next wave of expansion.

Innovation remains a key enabler of our growth. This year, we strengthened our technology edge across both product and process fronts. After over three years of development, we began supplying Electrical Submersible Pump (ESP) Cables to global oilfield markets, becoming the only Indian manufacturer in this niche B2B segment. Further, we are set to launch high-voltage HVDC cables from our Sanand facility, further deepening our presence in the extra high voltage domain.

At the Sanand plant, we are also building E-beam capacity for cables – used in railway and shipbuilding applications – marking another step towards completing our product portfolio. Our R&D strategy is anchored in domain expertise, supported by overseas specialists who drive materials and product innovation.

On the operational front, we advanced our digital transformation with machine-level digitization pilots at the HT Plant in Bhiwadi. These are designed to enhance productivity and reduce downtime. As the digital economy expands – with rising demand from EVs, data centers, and smart infrastructure – we are well-positioned to capture emerging opportunities in next-generation cable applications.

Our investment philosophy remains simple – anticipate demand, stay ahead of constraints, and build capacity before it’s needed. FY 2024-25 exemplified this approach, as we accelerated capital deployment to strengthen our manufacturing footprint and unlock scale-driven growth.

We did capital expenditure of Rs. 698 crore across both brownfield expansions and the marquee greenfield project in Sanand. The commissioning of expanded capacities at Chinchpada and Pathredi enhanced our output in key product lines such as house wires and LT power cables. With cable division utilization touching ~85% by year-end, these additions directly supported our growth for the year.

Central to our long-term growth agenda is Sanand project. The strategically located and technologically future-ready facility will cater to LT, HT, and EHV segments – including large-format exports. In FY 2024-25 alone, Rs. 384 crore was invested on this project. The first phase will go live by September, 2025, with full completion targeted by Q1 FY 2026-27. Once operational, Sanand will add approx.

Rs. 5,500-6,000 crore in production capacity. Further to secure our long-term visibility, we have acquired 18 acres land at Salarpur, Rajasthan and in the process of acquiring a sizeable land at Kheda, Nadiad, Gujarat.

Our financial prudence is the core to this scale.

We have undergone a successful QIP fund raising to fund capex, repay debt, and protect internal accruals – ensuring we maintain a strong, low-leverage position. In FY 2025-26 and 2026-27, we plan to invest another Rs. 1,300 crore in Sanand Project. After completion of Sanand Project, we endeavor to do capital expenditure of Rs. 700-800 crore each year for the next phase of capex for low voltage and medium voltage cables which will be funded through internal accruals. This long-range view, backed by disciplined execution, positions us well to achieve growth in revenue of 19-20% CAGR over a period of next five years.

Sustainability is embedded in the way we design, operate, and grow. We strengthen this commitment through tangible actions across our environmental footprint, workforce development, and community engagement. Our approach is guided by long-term value creation that balances business performance with stakeholder well-being.

We invested in multiple initiatives to reduce our environmental impact and drive responsible manufacturing. Our plants operate as zero liquid discharge facilities, supported by rainwater harvesting systems and increased use of renewable energy. Ongoing process improvements across locations helped us reduce energy consumption and optimize resource use. This year, we also took deliberate steps to enhance product-level sustainability, especially in cables that promote lower power loss and efficiency in end-use applications.

On the social front, our partnerships with institutions like ISKCON helped us drive large-scale food relief programs, while our broader CSR agenda included investments in healthcare, education, women empowerment, and shelter for the marginalized. Internally, we strengthened our people-centric culture with upskilling programs, employee engagement platforms, and safety-first practices across plants.

Together, these actions reinforce our purpose-led growth journey – built on inclusion, resilience, and responsibility.

Read more about our sustainability endeavors at Human Capital (Pages 38-45), Social and Relationship Capital (Pages 56-63), and Natural Capital (Pages 52-55) chapters.

India is projected to emerge as the world’s third-largest economy in the coming years, powered by robust GDP growth, an expanding urban base, and policy-led infrastructure creation. The Union Budget 2025-26 has laid clear emphasis on capital outlay, housing schemes, urban development and energy security –triggering a multi-sectoral surge in demand for cables across housing, data centers, renewables, and electric mobility.

The Government’s push towards affordable housing through PMAY, revival of stalled projects via SWAMIH Fund II, and targeted urban development through the Rs. 1 lakh crore Urban Challenge Fund are expected to accelerate construction activity. This, coupled with rising aspirations among a young population and expanding nuclear families, will amplify demand for low-tension wires, house wires and communication cables.

Simultaneously, sectors such as renewable energy, electric vehicles, and data infrastructure are witnessing exponential growth. India’s ambition to achieve 500 GW of non-fossil fuel capacity by 2030, alongside growing metro, railway, and EV infrastructure, is creating demand for specialized cables, particularly in the LT, HT and EHV segments. The expansion of data centres – enabled by increasing digitization and 5G adoption – is further opening new frontiers for industry players like us.

The T&D segment, a key pillar of the power sector, is poised for transformation with smart metering, grid modernization, and renewable energy evacuation projects gaining momentum. Investments outlined in the National Electricity Plan and the National Infrastructure Pipeline will continue to enhance energy access and reliability across the country.

At the same time, India’s positioning as a preferred manufacturing destination is being strengthened by the ‘Make in India’ and Production-Linked Incentive (PLI) schemes, National Manufacturing Mission, and the National Critical Minerals Mission. These policies, supported by duty exemptions and domestic manufacturing incentives, offer long-term tailwinds to the wire and cable industry.

As industry dynamics evolve and the market welcomes new participants, we are confident in our ability to sustain growth through strategic differentiation. Our strong brand equity, wide distribution footprint, and leadership in high-barrier segments such as HT and EHV cables provide us with inherent advantages. Our established track record and strong regulatory pre-qualifications give us a clear early-mover advantage in institutional sales – segments where credibility, consistency, and compliance are critical to winning large-scale contracts. We continue to enhance our approvals portfolio, enabling our partners to secure projects swiftly and positioning us well ahead of potential entrants in high-stakes segments.

Our journey forward is anchored in clarity of purpose and confidence in execution. We are poised to explore the next phase of growth with responsibility and resolve. To this, I would like to express my sincere gratitude to our employees, partners, customers, Government and shareholders for their support and belief in our vision. Together, we move forward – stronger and more determined.

Sincerely,