Apar Industries raises margin guidance and triples FY27 capex

What's new

• FY27 capex plan of ₹1,500 cr, up from the ₹740 cr spent in FY26.
• Conductor margin guidance raised to ₹35,000-36,000 per MT.
• Conductor revenue crossed ₹10,000 cr in FY26.
• Cable business surpassed the oil division to become the second-largest segment.

Themes from the call

Key quotes

• "We expect that from a medium to long term perspective our conductor margins could be in the range of 35,000 to 36,000 per metric ton."

  — Kushal Desai, CEO

• "We plan to increase our capex for FY27 to about 1,500 crores in addition to the FY26 capex that we have incurred of 740 crores."

  — Management

The brief

Apar Industries is aggressive. Six months ago, management told shareholders that post-FY26 capital spending would drop. Today, they set an FY27 capex target of ₹1,500 cr. Equipment lead times have stretched to five years, so they are front-loading investment to keep pace with grid modernization and data center demand.

They also revised the conductor margin outlook. The target is now ₹35,000–36,000 per MT, higher than the ₹30,000 floor they stuck to since late 2025. This change follows a strong year where premium conductors accounted for nearly half of segment revenue.

Performance in other units varies. The oil business hit a wall in March due to Middle East supply disruptions, resulting in a ₹15 cr forex provision. The cable division is now the company's second-largest contributor, helped by B2B channel expansion.

Management faces new competitive pressure from domestic entrants like UltraTech and Adani. Rising freight costs and high polymer prices also test current margins. The shift from caution to high-intensity spending assumes that structural tailwinds in power transmission will persist through the decade. If demand softens or the cost of raw materials remains elevated, this massive capex will turn into a burden.