Buy Bansal Wire Industries; target of Rs 550: Anand Rathi

buy

Anand Rathi's research report on Bansal Wire Industries

Despite Q1 usually being sluggish for it, Bansal Wires posted record quarterly volumes (~0.104m tonnes), driven by integrating operations, a customercentric approach, presence across various end-user sectors, and innovation. It is on its way to raising its Dadri capacity by ~0.06m tonnes in Q2 FY26 and ~0.06m by Dec’25, cumulative installed capacity expected at ~0.679m tonnes. To push its products and capture higher market-share, it is expected to strategically compromise margins, which would help it grow rapidly. It is expected to increase volumes ~25-30% y/y to a ~10% market share in a few quarters. It plans to set up a 0.18m-tonne steel plant and a 0.06m-tonne stainless-steel wire plant at Sanand (Gujarat) for which it has earmarked ~Rs6.5bn capex. Once operational by Sep’27, this plant is expected to enhance RM integration, which will help it raise EBITDA/tonne to Rs8,132 by FY28. Considering the macro scenario, the ~0.06m-tonne Dadri expansion has been extended by a quarter and with the benefit of steel tyre cord (VAP) and RM integration, expected to accrue in FY28 we trim our FY27e revenue/EBITDA 2.4/7%.

Outlook

We expect ~18%/ ~19%/~20% CAGRs in sales volumes/revenue/ EBITDA over FY25-28. We roll forward our estimates to capture FY28 estimates. We assign a 1.4x PEG to derive a TP of Rs550 (34x the average FY27- FY28e P/E).

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Bansal Wire Industries - 24072025 - anand