India’s cable and internet gear makers are experiencing the effects of the US-Iran war, with companies citing higher raw material costs, export disruptions, and growing uncertainty across global markets.
The geopolitical tensions have pushed up prices of key inputs such as polyvinyl chloride (PVC), copper, aluminium, preform, helium and polymers, while also affecting exports to West Asia, according to companies such as Havells India Ltd, Polycab India Ltd, R R Kabel Ltd, Sterlite Technologies Ltd (STL) and HFCL Ltd.
“While US tariff headwinds have meaningfully moderated from peak levels, adding margins, we are seeing new near-term cost pressures from geopolitical disruption driven by the war in West Asia, particularly impacting helium and polymer inputs,” said Ajay Jhanjhari, chief financial officer at STL, during an analyst call on 29 April.
Helium is mainly used in making optical fibre for telecom networks, so it matters more to companies such as STL and HFCL. Polymers are used in almost all wires and cables to cover and protect them, affecting the entire industry.
To be sure, some telecom gear makers, impacted by the US reciprocal tariffs, saw an improvement in margins during the March quarter owing to the tariff being reduced from 50% to 15%. However, tensions in West Asia could limit improvements in bottom lines.
During the quarter, STL reported an Ebitda margin of 15.1%, up 4.5 percentage points sequentially. Despite the headwinds, the company has guided for a 20% Ebitda margin in 2026-27, driven by an increase in the demand for data centre connectivity. Ebitda is short for earnings before interest, taxes, depreciation and amortization.
Rising prices
To protect profitability, companies have resorted to sharp price hikes across wires, cables and optical fibre products. Polycab said it implemented cumulative price increases of 18-19% between January and March, fully passing on higher input costs to customers.
Havells took a blended price hike of about 8% in its cable and wire business, while R R Kabel said it continues to revise prices regularly in line with fluctuations in raw material costs. In the optical fibre segment, gear maker HFCL said its earnings from cable sales increased by 15-20%, supported by strong demand from hyperscalers, while STL said it is negotiating structural cost increases with long-term customers rather than relying on spot pricing.
In the cables and wires segment, volume growth has been limited, and any surge in revenue during the quarter was in value terms, meaning the price hike was passed on to consumers.
“We had low single-digit cable and wire volume growth. Typically, the fourth quarter is best for the industry, not just for Polycab. So obviously looking at the higher base of last year, we were able to still deliver some growth, but we were expecting much better growth,” said Shashank Yagnick, head of strategy at Polycab, in an analyst call on 6 May.
According to Yagnick, private manufacturing industries that use gas as a feedstock lacked visibility into supply beyond 3-5 days. The same impacted the demand from the private sector. Besides, the price of raw materials such as PVC, which rose by 60-80%, also affected distributor sales in March.
For Polycab, the cables and wires business at ₹25,178 crore contributed 87% to the FY26 top line of ₹28,883 crore. The company also expected exports to West Asia, around 15-16% of its total exports, to be affected in the near term. It now expects growth to shift increasingly towards the US and South America.
Export hurdle
Another key player in the wires and cables segment, R R Kabel, said around 40% of its export revenue comes from West Asia, equivalent to roughly 12% of total revenue, and acknowledged that disruption in the region could continue through the first quarter of FY27.
“...(the management) remains confident that diversified exports and domestic demand will help offset the impact over time. Freight and insurance cost increases are largely passed through to customers,” brokerage house Motilal Oswal said in a 30 April note.
The company's inventory levels increased during Q4FY26 due to higher exports-in-transit and shipment delays. Finished goods prepared for export but not dispatched in March, along with consignments already in transit, led to higher inventory values, the brokerage said.
Havells chairman and managing director Anil Rai Gupta said the company witnessed a 6% volume growth. “The industrial cable segment has grown much faster than the domestic wire segment. We saw destocking in wires in the first half of the fourth quarter, and there was a high base of last year,” Gupta told analysts during an earnings call on 22 April.
HFCL said that despite rising input costs, its supply-chain operations remained unaffected, with no material impact on production or dispatches. It said its order book touched an all-time high of ₹21,200 crore, of which export orders accounted for ₹12,250 crore, or 58% of the total.