KEI Industries Limited (NSE: KEI) Q4 2025 Earnings Call dated May. 07, 2025
Corporate Participants:
Unidentified Speaker
Anil Gupta — Chairman & Managing Director
Rajeev Gupta — Director of Finance and Chief Financial Officer
Analysts:
Unidentified Participant
Achal Lohade — Analyst
Praveen Sahay — Analyst
Bharat Shah — Analyst
Dhruv Bhatia — Analyst
Akshay Gattani — Analyst
Vidit Trivedi — Analyst
Naushad Chaudhary — Analyst
Shrinidhi Karlekar — Analyst
Natasha Jain — Analyst
Nikhil Purohit — Analyst
Rahul Agarwal — Analyst
Sravan Vijayaraghavan — Analyst
Presentation:
operator
Ladies and gentlemen, good day and welcome to Kei Industries Limited Q4NFY 25 earnings conference call hosted by Nuama Institutional Equities. As a reminder, all participant lines will be in the listen only mode. And there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing start then zero on your touch tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Achal Lohade from Nuama Institutional Equities. Thank you. And over to you, sir.
Achal Lohade — Analyst
Yes, thank you, Manav. Good afternoon everyone. On behalf of Nuama Institutional equities we are glad to host the Senior Management of KEI Industries. We have with us Mr. Anil Gupta, Chairman and Managing Director of the company. Mr. Rajiv Gupta, Executive Director, Finance and CFO. We’ll start the call with opening remarks from the management and then move to Q and A. Thank you. And over to you, Anilji and Rajiv Singh.
Anil Gupta — Chairman & Managing Director
Good afternoon. Dear colleagues. Thank you very much for joining. I am Anil Gupta, Chairman and Managing Director, KDI Industries Limited. Along with me, Mr. Rajiv Gupta is also there. Executive Director and CFO. So I’ll give a brief about the Q4 summary of the company’s results and briefly about the annual results. So you must have gone through the results by now. The net sales in Q4 achieved this 2914.8 crore. We have achieved a growth in net sales by 25.1%. EBITDA is in line grown by 30.3% during this period. In the Q4 and EBITDA outlay, net sales margin is 11.61% as against 11.15% in the same period previous year.
Profit after tax in this quarter is rupees 226 crore against 168.8 crore. The growth in the PAC is 34.2%. Profit after tax. Oblique net sale margin is 7.77%. Domestic institutional cable sales. Can we shift to annual results? Domestic institutional cable sale Wire and cable is rupees 760 crore against rupees 76 crore last year. And domestic export sale in this quarter is rupees 492 crore. Cable and wire rupees 429 crore. Extra high voltage 24 crore. EPC rupees 16 crore. Stainless steel wire rupees 23 crore. This is again 257 crore in the previous year. Same period. The growth in the export is around 92%.
I would like to mention that we have focused on export and earmarked a substantial capacity on exporting. Hence you know the growth in the domestic sale is around 18%. Is it checked? But overall we have grown by 25% total cable institutional sale. That means B2B is 46% as against 44% in the previous year. Same period Sales through distribution network. That means B2C was rupees 1498 crore in fourth quarter against sale period rupees 1056 crore. Growth in the B2C sale is 42%. B2C sale through distribution network contributed 51% in fourth quarter as against 45% in the previous year same period.
Overall wire and cable segment has grown in this quarter approximately 35% over previous year same quarter and the profitability has also improved in the wire and cable segment during this quarter. EPC sales other than cable is rupees 72 crore as against previous year same period 192 crore due to decline in EPC sales by 63% and EHV cable sale declined by 48% during the quarter. Company’s operating margin also got affected by approximately 0.5% which will improve in the current financial year because of the healthy order book of extra I voltage cables. As on today, out of total sales of EPC EHV EPC sale is 32 crore as against rupees 50 crore in the same quarter previous year.
Now I’ll give a brief summary of annual results of financial year 2425. Net sales in the financial year 2425 is rupees 9736 crore against rupees 8120 crore. Growth in the net sales is 19.9%. EBITDA is 1062 crore and the growth in EBITDA is 19.9%. EBITda outlay net sales margin is 10.92% for the full year same as the previous year. Profit after tax in FY24 25 is 696 crore. So the growth in the PAT is 19.85% profit. Oblique net sales margin is 7.15%. Similar to last year. Exports in FY24 25 total is rupees 1,267 crore. In this wire and cable is 983 crore.
Extra high voltage cable 72 crore. EPC 105 crore. Stainless steel wire 104 crore and trading sale rupees 3 crore against previous year same period it was 1097 crore. Growth in export sale on full year is 15%. But growth in the cable export is 40%. Because of the decline in EPC sales, we are executing a contract for Gambia for EPC turnkey project. Last year there was a substantial sale in that project hence the EPC sales was high. But the growth in the cable export is 40% in the whole year. The total active working dealer for the company as on 31st March 25th are approximately 2082.
Sales through distribution network for full year is around 52% against 46% in the previous year. The ETC sale other than Cable is 343 crore against rupees 562 crore in the previous year. Out of the total sales of EPC EHV extra high voltage EPC sale is 137 crore against rupees 155 crore in the previous year. The sale of stainless steel wire in 2425 is rupees 212 crore against previous year 218 crore. Volume increase in the cable division based on the production and for the consumption of metal in FY2425 as compared to previous year. Same period is approximately 20% and in Q4 volume increase is 21%.
Total pending order including EPC as on 30th 25 is approximately 3839 crore out of which EPC orders are 423 crore. Extra high voltage cable pending orders are 603 crore. Domestic cable orders 2112 crore, cable export orders 701 crore. So the total cable and wire segment is 3416 crore and the total order book including EPC is 3839 crore. CARE has upgraded companies long term ratings as AA long term ratings from India Ratings and Research Private Limited and ICRA is AA short term rating from India Ratings ICRA and CARE is A1. The book value per equity share of the company is rupees 605 as on 31st March 25th as against 348 as on 3-31-2024 increased due to QIP issue.
Company has booked an expenditure of rupees 12.91 crore in FY2425 towards CSR activities. Total borrowing is rupees 178. Channel finance out of which channel finance is 127 crore. Acceptance creditor as on 31-03-25 is 246 crore as against 506 crore in as on 31-03-24. Net cash available is 1491 crore. This includes rupees 1385 crore of QIP as on 31-03-25 QIP fund status the company has raised rupees 2000 crores through QIP on 28-11-24 to fund our new project at Sanand Repayment of outstanding debt debt and for general corporate purposes rupees 1,450 crore for capex rupees 240 crore for general corporate purposes rupees 276 crore for repayment of term loan and WCDL and rupees 34 crore QIP expenses.
Company has utilized UIP fund of rupees 621 crore up to 31st March 2025. Now the future outlook during 2425 the company has incurred a total capital expenditure payment of rupees 618 crore out of which Sanan rupees 384 crore Chinchpala in Silvasa rupees 68 crore Diwali 32 crore Pathridi expansion rupees 58 crore and Salarpur land rupees 23 crore. Other plants and locations Rs. 53 crore brownfield capex at Chenchwada and Patridi have added further capacity for wire and power cables and these extensions have been completed in FYE 2425. After the completion of these brownfield capex capacity utilized during 2425, approximately 85% in cable division, 71% in house wire division and 89% in stainless steel wire division and 38% in communication cables.
During the current financial year 2526 unutilized QIP fund of rupees 1300 crore will be invested to complete the Fanon project. Commercial production of first phase of low tension and HT cables will commence by end of Q1 FY25 26 and the total project will be completed by end of FY25 26. Company is hopeful to achieve 17 to 18% growth and improve our operating margins during the FY25 26. Considering phase one commercial production in permanent and strong order book Division of Domestic institutional for cable sales, Export order for cable sales and extra high voltage cables and the total order book of cable at 3416 crore.
After completing the Sanan project and with the continued strong demand in domestic and overseas markets, we are hopeful to grow by 19 to 20% in next two to three years. Now I’ll explain you what are the demand drivers in the domestic markets and export markets? The major demand drivers are power generation in renewables through solar and wind energy and also we are seeing A substantial new investment coming in coal based thermal power projects and related infrastructure in transmission and power distribution by transmission and distribution companies of central government and state government user user industry of energy like data center, new manufacturing projects and infrastructure projects like railways and metro rails and highways.
Apart from that, electric vehicle infrastructure and kits for electrical vehicles is also in our product range which we are catering to EV infrastructure. We show that we continue. We’ll continue to grow with the projected percentages what we have stated and we’ll try to improve upon it during our current financial year and subsequently this will be our endeavor to keep the growth momentum in the company on a continuous basis. Thank you very much and I would like you to. I would like invite you to have any further questions you may have. We’ll be glad to answer.
Thank you.
Questions and Answers:
operator
Thank you very much sir. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to withdraw yourself from the question queue you may press star and 2. Participants are requested to use handsets only while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. I repeat, you may press Star and one to ask a question. We have a first question from the line of Praveen Sahai from Prabhu Das Capital. Please go ahead.
Praveen Sahay
Yeah. Hi sir. Congratulations for good set of numbers. My first question is related to the volume growth and this is clarification. So in the Q4 you had said 21% of a volume growth in the wire and cable segment you had reported that is including domestic and international. Is it correct?
Anil Gupta
Yes.
Praveen Sahay
So. So if you can give a bifurcation.
Rajeev Gupta
It is based on the production.
Praveen Sahay
Okay. And how is the domestic market has done in terms of volume?
Rajeev Gupta
We are using the volume growth only on the business of production based production capacity constraint. So whatever we are producing either we are selling through export or selling through the dealer distributor market or directly selling to the institution. So it does not matter to us. In some quarter we may sell more in domestic. In some quarter we may sell to export market more and some quarter we may sell more to the dealer distributor. So ultimately it does not matter in which market the product is going but the overall growth rate need to maintain according to the production capacity we are having.
Praveen Sahay
Right sir. Or if you can give some more color on your export number because that has grown quite, you know very strongly. Is that a one off element attached to that? And is that also if you can add is that the benefit of a U.S. tariff you received certain things.
Rajeev Gupta
No, no, no.
Anil Gupta
First of all this is not a.
Rajeev Gupta
Yeah, first of all as I said that it is sometimes we get the order from the export market so we need to book the capacity accordingly. So from where we are getting the order first we need to book the capacity accordingly.
Anil Gupta
These are not one off exports. These are consistent exports from our consistent customers. This export in Q4 is not consisting of any single large order we have received. It is consisting of several orders of different territories. So. And these are our consistent customers.
Praveen Sahay
Right sir. Got it. Second question sir, related to the EHB that’s 400 odd crore for revenue we had done. And the way forward I believe the guidance Is of a 600 odd crore. So how you are going to see this EHP business the way forward? Because your capacity at a Sanand is also coming up. So in the next two to three years if you can give some, you know guidance related to the EHV would be helpful.
Rajeev Gupta
EHV capacity in Sanand will be operational by in the FY 2627 because that PHV segment of the project which is phase two will be completed by March 26th. So that means that capacity will be there for Production only in 2627. And our focus will be mainly on domestic market as well as exports. Both we have a substantial export market of EHV cables which we have developed. But there are some technical constraints due to which we can’t sell too much in the export market because of the high freight and heavy loads which has to be carried from the North India to port.
So there are some technical issues and dumb lands which we need to be producing the long, very long length because which we will be able to produce in Sanand. So there are some technical issues due to which we are not able to grow the export market substantially for our existing Kyopanqi factory. But the moment Sanand comes the export will see a substantial jump in the extra high voltage segment also and as well as the other segments where we are lacking the capacity.
Praveen Sahay
Okay, okay. And just to related to that even the export has gone up more. And this quarter we had seen that the LME prices were also up. But that’s not reflecting in the margin front actually. So if I look at your margin, the gross margin has been YUI. It’s quite a, you know, 1% down. So what factor lead to that?
Rajeev Gupta
LME prices will not suffer in the margins. LME prices if they are high they can increase the sale value. But margins are quickly adjusted with respect to the raw material cost. You can speak something about it.
Anil Gupta
What is your exact query?
Praveen Sahay
So sir, what I believe is if there is improvement uptrend in the element prices there would be a some gain also you absorb. And the second is the export business. If that is increasing, that is a high margin business. So why not our gross margin reflected these two factors in this quarter.
Rajeev Gupta
First of all in the past also we have guided that all the raw material pass through Whether it’s going up or it’s going down, Neither we will be gaining anything. Neither we will be losing anything. Second is in the case of export as I said in the case of only half percent margin is improved. In the case of export or dealer distributor margin otherwise more or less prices are similar. That’s why we are not only focused for any particular each segment. As we are operating in an environment where we are catering to all type of customers from where we are getting the orders we are utilizing the capacity accordingly.
That’s why we are saying that we will be growing in future also 17 to 18%. But it does not matter to us. We will grow in export, we will grow in dealer distributor or we will grow in institutional segment. Ultimately object is to utilize the capacity and a little bit margin which got affected mainly because of the lower sale of each EHV division. So since now the current year the EHV sale will be to the full of fullest capacity. So the this half percent EBITDA margin will get improved, the operating margin will get improved.
Praveen Sahay
Right? Thank you sir, if you can give the capex number for 2627 would be helpful.
Rajeev Gupta
Around 1300 crore. Because whatever unutilized UIP money is there that will be invested in to complete this Asanan project in the current financial year. And apart from this another 100 crore is for maintenance, capex and for the new land.
Praveen Sahay
Thank you sir and all the best.
Rajeev Gupta
Okay.
operator
Thank you. We have our next question from the line of Bharat Shah from Ask investment managers. Please go ahead. Yeah.
Bharat Shah
Namaste Anilji and Rajiv Ji. Namaste Anil. He talked about 17 to 18% growth rate with improvement in margins. Is that a reference to the upcoming year, financial year 20, 25, 26 or for the longer term? Because on the longer term I thought with the increase in capacity we are aiming for growth upwards of 20%.
Anil Gupta
In. Longer terms I have mentioned in my commentary that the growth will be upward. This 17 to 18% growth I have mentioned only for 2526. Because in this year we will be only settling the new plant one by one month after month we’ll be able to ramp up the production month after month even after commissioning. So this will be challenging year for us to ramp up the capacity and bring it into. Convert it into. Into commercial production. However, I have said that we will aim to achieve better. I am only saying it little conservative either because my approach is always to say less and achieve more.
We have always achieved better than what we have always said. Good.
Bharat Shah
For a moment I thought. I’ll just.
Anil Gupta
Upwards of 20% from 26, 27 onwards. But in this year also we will aim to achieve 20%. We will definitely not let down our investors.
Bharat Shah
No. Thank you. That clarifies just one last thing Rajiv. The margin improvement journey over the period. Of time due to variety of factors. That we have discussed many a times. That is intake, right?
Rajeev Gupta
Yes sir. That’s only after the commissioning of this plant. As I said in from 27:28 onward when the economy of scale will be there and the benefit out of that will be there. Thank you. Thank you.
operator
Thank you. We have our next question from the line of Dhruv Bhatia, an individual investor. Please go ahead.
Dhruv Bhatia
Hi. Thank you for the opportunity and congratulations on great set of numbers. Sir. The question is around working capital because when you see your cash consolidated cash flow, your cash flow generated from operations last year was about 815 crores and this year it is down 200 crores approximately so. And working capital has seen some massive swing. So what. What exactly happened? If you can explain and whether that’s. Going to change in advice
Rajeev Gupta
as the earlier guided that till we are having the cash we will be purchasing through cash. So you must have seen in the balance sheet that the payable item has reduced substantially. Even though the sale has increased by 20% but the payable has reduced. So that is mainly because of that, nothing else. In the. In the normal condition the payment will go up.
Dhruv Bhatia
Right? And the second question I have sir is you know it’s a slightly more industry wide one. You are having some new very aggressive competitors talking about large amounts of CapEx to enter the sector in the next 2, 3 years. How do you see that playing out? Demand is obviously very strong and continue to grow. So do you see an impact on margins potentially in this sector once these capacities come on stream?
Rajeev Gupta
We are already here and since last 15, 20 years we are delivering the numbers and whatever we are seeing we are delivering even in the last quarter. So much eventually was there for the industry but then the sea has given the results not only by Ki but Aldi but the other player also. The growth is there and the momentum in the industry itself is very strong. So if little bit EBITDA margin, no one can say anything. But no any major impact.
Dhruv Bhatia
Okay. Thank you.
operator
Thank you. We have our next question from the line of Akshay Gattani from ubs. Please go ahead. Thank you sir, for the opportunity. My question is on the export business. Sorry to interrupt. Mr. Akshay, can you please be a little louder?
Akshay Gattani
Yeah. Hi. Is it audible now?
operator
Yes. Yes.
Akshay Gattani
Yeah. So my question is on the export side of the business. So how is US market shipping up post tariff announcement? Like have you seen any temporary pause in the consignment? Also, how do you see US geography from a longer term perspective in terms of product approval and product acceptance? There. Thank you.
Rajeev Gupta
Actually, as of now whatever order we were having, we had delivered. So it will be known only after two, three months when everything gets settled from the US market. But as I said earlier that for us it does not matter. We are selling to US market. We are selling to Middle east or we are selling to Asian market. And for the next year onward because of the capacity we will be growing close to 20%.
Akshay Gattani
Sorry, Rajiv ji, I think we lost to for 30 seconds
Rajeev Gupta
I said that. For the current year our growth rate announced is at 18%. And from next year onward we will be growing close to 20%. This is on the capacity. Because market is so huge. Number of customers from overseas as well as from domestic are very large in number of lists we are having. So we are not dependent only on one country.
Akshay Gattani
Perfect. Thank you, sir.
operator
Thank you. We have our next question from the line of Vidit Trivedi from Asian Market securities to. Please go ahead.
Vidit Trivedi
Yeah. Hi sir. Thank you for the opportunity. And congratulations on the great set of numbers. Could you please tell me what’s your mixed. I mean how much do you export to the years of the overall exports? And second coming to the EHV cable side, you know it has dropped sharply. What was the main reason of the contraction? And where. When do you see the recovery happening?
Rajeev Gupta
Recovery has already happened. We have already order book is around 603 crore. So in the current year we will be utilizing the full 100% capacity.
Anil Gupta
Some of the executed because of the row issues.
Vidit Trivedi
Okay. And what’s the US share?
Anil Gupta
US this year we have exported close to around 250 crore.
Vidit Trivedi
163 crore.
Anil Gupta
Exactly 163 crore. Sorry.
Vidit Trivedi
Thanks a lot, sir. That’s helpful. All the best.
Anil Gupta
It’s a very small portion of our exports going to us.
Vidit Trivedi
Yes. Thank you.
operator
Thank you. We have our next Question from the line of Nosha Chaudhary from Aditya Billa Mutual funds. Please go ahead.
Naushad Chaudhary
Yeah. Hi. Thanks for the opportunity. Just one clarification sir. During FY25 the key raw materials, copper and aluminium. On a low base it went up 13% 15% in iron atoms. And on that on a blended basis if I see our revenue was up 20%. So with reverse and very rough calculation roughly 10, 11% would have come from the value growth. And now as the copper and aluminium both are softening at least for now based on March closing, considering this fact, is there any risk to our guidance of 17 18% for FY26 given the direction?
Rajeev Gupta
First of all, in last four five years in one year copper aluminum goes up. In one year copper aluminum goes down. But in all the last four five years or in last 15 years we are continuously growing. In last 15 years so many times copper or aluminum has gone up and so many times copper and aluminium has gone down. So it does not impact really because we are searching for a newer market for ourselves. That’s how we are growing year after year. And it is applicable to the whole industry. Not only Kei, the other player also growing into the impact of the increase or decrease is not matter for the group.
Naushad Chaudhary
Second, do we quantify the inventory gains if any?
Rajeev Gupta
As I said we are working on a pass on mode. Neither we are gaining, neither we are losing anything.
Naushad Chaudhary
Okay sir, all the best. Thank you.
operator
Thank you. We have our next question from the Lino Sri Nidhi Karlikar from hsbc. Please go ahead.
Shrinidhi Karlekar
Thank you for the opportunity and congratulations on great set of. Just a couple of question on export business. Since the last year we have had a 1260 crore kind of export business. And you said 160 crore was us. Is that right?
Rajeev Gupta
Yes sir.
Shrinidhi Karlekar
Okay, so my second question on that is what are like principal competitors in the non US markets? Like are these local companies or are these global companies? Or we face more of a Chinese competition. This I’m talking about non US market.
Anil Gupta
Mostly in non US or US market we have only global competition. And in non US market I think wherever we are exporting, I have not seen any Chinese competition to US because we manufacture specialized tailor made products for projects. And wherever tailor made projects products are manufactured as per the international specification and with the specified approvals. We don’t face competition from Chinese companies.
Shrinidhi Karlekar
Right sir. And sir, second, I’m bit confused. On your margin guidance for the next two years would it be possible to quantify how much of EBITDA margin improvement One should build for the next two years.
Rajeev Gupta
Yes, we are saying that because of the economy of scale from 2728 onward, when our Sanon project get established, little bit EBITDA margin will improve.
Shrinidhi Karlekar
But not in 2627, is it sir?
Rajeev Gupta
Not. No.
Shrinidhi Karlekar
Okay. And when you refer to EBITDA margin, you refer to EBITDA margin including order income, which I think last year we.
Rajeev Gupta
Did like whenever we take the margin. That is including everything,
Shrinidhi Karlekar
including all the income. And the last question I have is sir, I want to understand the HP cable business that we have of about 1:2,000 odd crore. What are like largest end markets for that? For the HT cables.
Anil Gupta
HT cable main customers are power distribution. Power distribution companies and including the solar and wind projects because they need HD cables for evacuating the power generated through solar farm and take the power to the grid. So the major consumers are solid solar power projects and power distribution company.
Shrinidhi Karlekar
Understood. Sir, thank you for answering my question and all the very best.
operator
Thank you. We have our next question from the line of Kunal Saeed from BNK Securities. Please go ahead.
Unidentified Participant
Yeah, thank you. Sir, my question have been partly answered. This was about margin only. But sir, just one clarification. Initially we were talking about a small margin improvement. Every year about 20, 30 bits. So has anything changed there, sir? Because now we are talking about margin improvement in 27 and not in 26.
Rajeev Gupta
Margin last year also we have guided that once we settle down this new product in the new facility only economy of scale we will be improving. Otherwise whatever EBITDA margin 11% around we are operating, we will be operating at that level.
Unidentified Participant
Sure. So sure sir. Thank you.
operator
Thank you. A reminder to all participant, if you wish to ask a question you may press star and one on your phone. I repeat, if anyone wishes to ask a question, you may press star and on we have our next question from the line of Avnish Varnan from Vicaria Investment Management. Please go ahead.
Unidentified Participant
Yeah, hi, good afternoon. Thanks for taking my question. I have two One regarding the US market. In this industry wide and trading industry. Mexico seems to be like a key geography which is exporting to the U.S. my question was that in the past there have been claims that Mexico has been acting as a transshipment hub for the Chinese materials. So I just wanted your opinion on that. Is Mexico a key transshipment hub for China? Or do you think Chinese material gets through into us through countries more like Vietnam and Cambodia and not really Mexico? This Chinese material coming through transshipment.
Anil Gupta
This is not our outlook to. This is not for us to, you know, inquire because this is for the US government to see that from where the Chinese material is coming, we are creating our own market and our own niche markets and niche customers and catering to them and at our terms. I mean I can’t answer this question about this trans shipment of Chinese products.
Rajeev Gupta
Sir, I would like to add here is because whether US government is taking the material or not taking the material, it will not impact the industry of the the India. Because whatever rate we are growing, we. Will be growing
Anil Gupta
ultimately we are last year, whatever exports we have done, there might be some Chinese or other Mexican companies must be in competition.
Unidentified Participant
Yeah, no, I was asking from the angle that if tomorrow there is a increase, let’s say incrementally higher tariff on Chinese goods and any goods that are sourced from China, then is there a possibility of any market share shift from Mexico to India?
Anil Gupta
India as it is, there is so much of tariff on China at the moment that nobody can import by paying those tariffs.
Unidentified Participant
No, no, I was asking about Mexico because if, I mean that’s why I was asking whether Mexico acts as a front for China.
Anil Gupta
No, we are not really aware of.
Unidentified Participant
Okay, that’s fine. My second cost was. Now I understand there is uncertainty on the tariff but let’s assume after the 90 day post the tariff settles at whatever that amount would be, let’s say 10%. Who according to you will bear the cost? Will it be the OEM or will it be the manufacturer or the distributor? Like who bears this 10% cost? Whatever that number settles to be, it.
Anil Gupta
Will be borne by the end customer. I mean our offers are always without duty. So whatever tariffs are imposed in us, they have to be paid by them. So we are not concerned about the tariff at our end. Okay.
Unidentified Participant
Okay. And in your US exports, do you sell through dealers and distributors or do you sell directly to the OEMs and the customer?
Anil Gupta
I think 50% is through the directly to OEMs and 50% through distributor network.
Unidentified Participant
And sir, your contracts would be sob or like what kind of contracts would you have and how are tariffs mentioned in those contracts?
Anil Gupta
It varies. There can be they are CIS or fob but tariffs are always any extra tariffs are always payable by the customer. That is our contracts are very clear.
Rajeev Gupta
All all cost in past three basis.
Anil Gupta
Who can be at 10% or 26% tariff.
Unidentified Participant
Understood. Thank you so much. Radiji and Anji, this answers my question. Thank you sir.
Rajeev Gupta
Thank you.
operator
Thank you. We have our next question from lineup. Disha Kodia, an individual investor, please Go ahead.
Unidentified Participant
Hello.
Anil Gupta
Yes madam.
Unidentified Participant
I hope I’m audible, sir.
Anil Gupta
Yes, yes please. Please go ahead.
Unidentified Participant
Yeah, so. So. So you mentioned your past commentary how you want to scale up the export and we’ve seen the growth. So what is the target? Like what is the target as a percentage of revenue? How much exports are you targeting as a percentage of revenue?
Rajeev Gupta
Sir, over our target is to utilize the capacity and growth rate will be 17 18% in current year. It does not matter to us whether it is coming from export, it is coming from dealer, distributor or it is coming from the domestic institution. Ultimately we have to utilize the capacity. So that is our main object.
Unidentified Participant
All right. All right. And where do we see like do you see steady increase in your market share or do you expect it to be remaining at what the current level is? Given the new competitors that are coming.
Rajeev Gupta
We are able to utilize the capacity to sell because we cannot sell more than the capacity which we are having.
Anil Gupta
We expect to increase. We will try to increase our market share from FY 2027 when a substantial new capacity comes on board available to us.
Unidentified Participant
All right. All right. Thank you so much, sir.
operator
Thank you. We have our next question from the line of Natasha Jain from Philip Capital. Please go ahead.
Natasha Jain
Thank you for the opportunity. Sir. My first question is how does the pricing work? Is it per kg basis or percentage of raw material price?
Rajeev Gupta
It’s a cost plus basis and in terms of percentage.
Natasha Jain
Understood. So my second question is more industry based. So now that most of the. I mean the major players of wires and cables, the results have been out. We have seen that there has been strong top line growth which is warranted because fourth quarter was a seasonal quarter. But then margin expansion has not happened. So is it fair to deduce that most of the benefits that the industry is going to get is out of scale and there may not be pricing advantage.
Rajeev Gupta
We are always saying that whatever EBITDA margin we are having we will be working in this range only.
Natasha Jain
Got it? Understood, sir. Thank you so much.
operator
Thank you. We have our next question from the line of Nikhil Purohit from Pydant Asset Management. Please go ahead.
Nikhil Purohit
Hi. Thanks for taking my question. My first question is what is the. Margin differentiation the domestic versus export markets for Wyzen cables?
Rajeev Gupta
Not more than half percent.
Nikhil Purohit
Got it. Okay. And additionally, do we stick to our. Earlier guidance of exports to the US. In FY26 being around 5 billion this. I think this year it was 2.
Rajeev Gupta
As I said repeatedly that it does not matter we are selling to export or we are not selling to export our matter to us is only how we are utilizing the capacity. We are exporting to more than 60 countries. As of now we are working with close to 2,100 dealer, distributor. We are working more than 2,000 institutional customers in the country. So we are growing in each segment whether in exports or in dealer, distributor or in domestic institutions. But how much do a one particular customer or how much do we have one particular country? It will not be basically easy to answer well in advance.
Nikhil Purohit
I understand. Okay. And lastly this one last question. What is the EHV execution this quarter?
Rajeev Gupta
EHV execution in the last quarter? Fourth quarter.
Nikhil Purohit
Yeah, quarter four FY25
Rajeev Gupta
fourth quarter sale was 115 crore as against 220 crore last year. Fourth quarter.
Nikhil Purohit
Okay, perfect. Thank you.
operator
Thank you. We have our next question from the line of Priyan Cheda from Rallying Capital. Please go ahead.
Unidentified Participant
Sir, I Sorry I would have missed. Out the volume numbers for this call quarter and for the full year if you can help me.
Rajeev Gupta
Fourth quarter the volume number was 21% and the full year volume growth was 20% for the metal growth.
Unidentified Participant
Perfect. And in the opening comment you did mention solar, coal transmission, data centers and ev. These are the core key sectors contributing to the volume growth. Now would it be possible to is.
Rajeev Gupta
There apart from this the infrastructure growth as well as manufacturing.
Unidentified Participant
Is there any big divergence or any one particular sector contributing to a very high incremental growth versus others? Would it be possible to quantify anything in any way?
Rajeev Gupta
Each and every sector is growing. Not a big sector, but power is growing.
Anil Gupta
But if I have to specify one significant sector, I.e. the significant any solar power project which is significantly high
Unidentified Participant
and given the installations of solar which is likely to drop versus significant installations that have happened in this year, anything that you would think that would be compensated by some other factors. Any view on that?
Anil Gupta
If the power availability is high, then related infrastructure of transmission and the user industry has to grow so that. So there is always a balance of various sectors going side by side. Because if you are producing too much of power but there is no user, what is the benefit of generating that much of power either through so solar or thermal? So the user sector also grows simultaneously.
Unidentified Participant
Got it. And so just last thing to clarify, you did mention that you work on a cost plus model and when we see the gross margin slightly drifting down from 25% to 23.5% it’s because the copper prices are higher and the realizations are higher and hence the percentage margin margins are lower. Right? Is that the way to read.
Rajeev Gupta
So as you want to read, you can read. But the issue is the operating margin and the EBITDA margin will remain in the range range bound 10 and a half to 11%.
Unidentified Participant
Perfect. Thank you.
operator
Thank you. We have our next question from the line of Rahul Agarwal from HK Asset Management Management company. Please go ahead.
Rahul Agarwal
Hi sir, very good afternoon. A couple of questions. Firstly, are we seeing you know, higher employee attrition? I think the industry is going through a lot of Capex cable wire is becoming very attractive for you know, skilled jobs. Yeah, sure. But are you seeing attrition in your company? Okay. Okay, good. And second question was on working capital. I think somebody previously asked. Just wanted to clarify. You know obviously the operating cash flow generation number looks lower because you’re paying payable faster and this process actually started pretty long back. Right. You’ll be doing that for a very long time. My sense was that ultimately if you pay tables faster there has to be some savings on interest wherein you have a lesser non fund based credit. Is that correct? Agree sir. So the interest saving should reflect somewhere in operating cash flow rate. Operating cash flow? Yeah. So when I look at console cash flow expl. When I look at console cash flow the payable swing is about 314 and 130, about 430 crores. That’s the swing from the last one.
Rajeev Gupta
Cash flow increase, decrease in inventory increase, decrease in the significant increase decrease in credit amount casca shorter so extra.
Rahul Agarwal
Absolutely right. What is the benefit of that? We have discussed this in the past. So you mean that operating cash flow, you know, whatever is getting disclosed is not the right way to look at it. Right? That’s what you mean? Okay, thank you so much. And all the best.
Rajeev Gupta
Till the time that type of liquidity is available here anytime, at least one and a half months.
Rahul Agarwal
Is that the intention going forward? Thank you so much. All the best.
operator
Thank you. We have our next question from the line of Achal Lohade Firam, no ama Institutional equities. Please go ahead.
Achal Lohade
Yes sir. Just a couple of questions. You know first on the wires, you know I think in the entire conversation we have not really touched upon that part. It’s growing very, very well compared to the peers who are struggling with the growth. So you want to elaborate a little bit. What, what are we doing here in terms of, you know, the distribution expansion in terms of, you know, the growth there any particular region which is driving growth and the outlook.
Anil Gupta
So we are continuously focusing on increasing our data distributor network. So that’s continuous going on process and that will be maintained in future also. So because of that only we have cross 50% sale through dealer distributor. Otherwise our target was to reach only 47,8% in this year. But because of the buyer sale and our cable sales also through dealer distributor increase, we have reached to 51% also. So there is a continuous focus to increase the dealer distributor network in the eastern and southern part. We are already strong in north and west. So I mean the focus is still there.
Achal Lohade
Okay. And if you could also highlight, you know, in terms of the channel financing, where are we, how much of our sale we are able to, you know, of the dealer distributor, our channel financed. And how do you see that trajectory moving?
Rajeev Gupta
Almost now we have reached to a level where 70% of our sale are are covering through the channel financing. And year after year we are increasing this CL3 channel financing because it is giving us the lower number of days of achievement.
Achal Lohade
Right. And when you say 70% of sales, you mean 70% of the dealer distribution.
Rajeev Gupta
Yeah. 70 of the dealer distributors.
Achal Lohade
Understood? Understood. And that cash discount for those channel finance sales is obviously netted of indigest margins, right? So gross margins are after that.
Rajeev Gupta
Yeah. Yes.
Achal Lohade
And this 70%, any target you have in mind, sir, will it be like 90% or anything of that sort? Hello.
Rajeev Gupta
Hello. We are increasing the sales that how we are adding more and more dealer distributor under the channel financing.
Achal Lohade
Understood? Understood.
Rajeev Gupta
Yeah.
Achal Lohade
And the second question, you know, if I. If I make a quick summary of what you’re saying is essentially you will utilize the capacity fully. That should drive 18% revenue growth. And the margins while because of EHV and wires margin should improve. But because of the new capacity related expenses, the margins are expected to remain stable. Have I understood right, sir?
Rajeev Gupta
Yeah, that’s right.
Achal Lohade
Okay, thank you. I’ll. Thank you auditor. We can take the next question.
operator
Thank you sir. We have our next question from the lineup. Ankit Soni from Sherkhan Mary Assets. Please go ahead
Unidentified Participant
sir. Good evening. Congratulations on a good set of numbers. Just one question from my side. So once your Sanant facility is operational, what time would we take to get onto a full optimum utilization of the facility so that we can fetch that logistics benefit which you are right now triggering to? And what would be the margins jump after the capacity optimum? The after reaching optimum capacity utilization?
Rajeev Gupta
This capacity we have created to utilize within three financial years. Number one, because whenever any company add the capacity, they are not adding the capacity only for one year. They will be utilizing the capacity for next three, four years. Second is the half to 1% EBITDA margin will get improved. Will get start improving from 27, 28 onward.
Unidentified Participant
Okay.
Rajeev Gupta
Because economy has not because of selling price or anything else. Only because of economy at this scale.
Unidentified Participant
So. So follow up on that will be like. Will be taking around three years to fully optimally like 70, 80% capacity utilization from that particular Sanon facility. Am I right?
Rajeev Gupta
Yeah.
Unidentified Participant
Yes. Okay. Thank you.
operator
Thank you. We have a follow up question from line of Srinidhi Karlikar from hsbc. Please go ahead.
Shrinidhi Karlekar
Yeah. Thank you for the opportunity. So would it be possible to comment on how much of your domestic institutional business of about 3,100 crore comes from the power sector?
Rajeev Gupta
So normally power sector on an average is close to 30 to 35% directly or indirectly. You see, most of our dealer, distributor are also selling to the dollar to the power sector. Once we are selling the cable to them, they are also selling to them.
Shrinidhi Karlekar
Right, Understood. And actually this housing wire and winding wire business that we classify is that also retail channel or there is some bit of a direct channel in housing wire and winding wire.
Rajeev Gupta
Little bit institutional here also because not, not much but small. Like we are selling to LNT for a full package. So we. So we are selling to viral to them.
Shrinidhi Karlekar
But it will be small number as you said.
Rajeev Gupta
Yeah. It will be like last year number was close to 178 crore institution for the bias.
Shrinidhi Karlekar
Yes. Thank you for answering my question.
Rajeev Gupta
Thank you.
operator
Thank you. We have our next question from the line of Shravan from Sincere syndication. Please go ahead.
Sravan Vijayaraghavan
Hi. Yes sir. Congratulations on a good set of numbers. My doubt is that especially in the HV cable side, do you directly deal with these let’s say power T and D companies such as Hitachi, Siemens or do you go through dealers and distributors?
Rajeev Gupta
In the extra voltage power cable you are asking for transmission 50% we are selling directly to the power transmission companies.
Sravan Vijayaraghavan
Okay, sir.
Rajeev Gupta
And 50% through the EPC contractors.
Sravan Vijayaraghavan
Okay. Okay, sir. In the latest project that Hitachi has got, the 1200 kilometer project and the 950 kilometer project, any idea, have you backed any of those orders?
Rajeev Gupta
Whenever they will be required, the cable, it will be on that stage only.
Sravan Vijayaraghavan
Okay. Okay. Okay. So this comes later in this.
Rajeev Gupta
Yes.
Sravan Vijayaraghavan
Thank you sir.
operator
Thank you. Ladies and gentlemen, this was the last question for today. And I now hand the conference over to the management for closing comments. Over to you, sir.
Anil Gupta
Thank you very much for the participants. And we are once again assuring you all that we will be growing 18% kind of growth rate and it will not matter whether any contingencies are there or not there any rate increase or decrease. But we will be growing it in because we are adding the capacity. Thank you all.
operator
Thank you on behalf of NUAMA Institutional equities. That concludes this conference. Thank you for joining us. And you may now disconnect your lines.