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Quick Pointers

* W&C growth supported by commodity-led realization gains

* FMEG trend to remain mixed, led by solar and lighting segments

* RAC segment expected to post healthy pick up in quarter on summer-led demand for south India market

W&C companies under our coverage is expected to post double digit revenue growth in Q4FY26, driven by improved secondary sales, and commodity-led realization gains. However, the FMEG segment is likely to remain modest, supported by strong traction in solar products and steady recovery across appliances, fans, and lighting. RAC segment is expected to deliver healthy growth led by summer-driven demand revival, pickup in secondary sales, and premiumisation from energy-efficient models. We expect our consumer durables universe to register sales/EBITDA/PAT growth of 12.6%/2.6%/3.7% YoY in Q4FY26. Furthermore, we anticipate POLYCAB, KEII, and RRKABEL to outperform, while BJE to underperform in sales. In terms of profitability, KEII is expected to outperform.

We continue our positive view on W&C companies driven by strong realizations, domestic tailwinds, and favorable industry trends in both domestic and export markets while KEI and LGEL are our top picks.

W&C - commodity-led realization improvement: W&C companies under our coverage are expected to deliver flat to low single-digit volume growth in Q4FY26, with wire sales impacted with flat m-o-m copper prices in Feb-Mar’26 and after restocking in channel in Q3FY26. The companies benefited from higher realizations due to increase in commodity prices (QoQ: Cu up 18.6% & Al up 15.8% in Q4FY26). Domestic infrastructure buildout, housing activity, and the ongoing shift toward organized/branded players continue to support steady offtake. We estimate Havells/ Polycab /KEI/RR Kabel to see W&C revenue growth of 18.1%/24.3%/21.7%/21.9% YoY in Q4FY26.

FMEG – growth primarily driven by solar products: FMEG segment is anticipated to deliver mixed growth, driven by healthy and improving momentum in solar products, while the appliances category recorded moderate expansion. Small and large appliances are expected to gain traction in induction cooktops, driven by expected gas supply shortages, while the fan segment witnessed a gradual recovery, supported by the onset of the summer season. The lighting segment continued to maintain steady momentum across both B2B and B2C channels.  We expect coverage companies to report 2.3% YoY growth in the FMEG segment.

RAC – summer lead demand revival: Coverage companies are expected to report 12.7% YoY growth in the RAC segment during the quarter, supported by demand revival and pick up in secondary sales, primarily in the month of Mar’26 with LGEL sold more than 1mn units in Q4FY26. Production remained unaffected by LPG supply constraints, as companies under our coverage successfully transitioned to alternative fuel options. Additionally, the transition towards BEE-rated energy-efficient RAC models is expected to further support volume growth and premiumisation within the segment. Voltas UCP is expected to grow by 12.4% and Lloyd expect sales to grow by 13.3% YoY each with margins contraction.

Writing Instruments to drive growth: Cello World’s Consumerware segment is expected to remain flat, impacted by steelware supply constraints and lower glassware utilization, while the writing instruments and stationery segment is likely to deliver strong 32.4% YoY growth, supported by re-entry into the stationery segment under the “CELLO” brand.

Key changes in ratings/TP: We downward revise our FY27E/FY28E earnings estimates across coverage, except for LGEL, BJE, and CELLO. We upgrade BJE and HAVL to ‘BUY’ from ‘ACCUMULATE’, and VOLT to ‘ACCUMULATE’ from ‘HOLD’ due to recent correction in the stock prices, while maintaining our existing ratings on the rest of the coverage universe.

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