Dynamic Cables Ltd Management Discussions.


Dynamic Cables Limited (hereinafter "the Company"/ "DCL") is a leading player in manufacturing and supply of power & infrastructure cables.

Dynamic Cables is continuously expanding its footprints in all sectors like - INDUSTRIAL, EXPORTS, RAILWAYS, POWER DISTRIBUTION COMPANIES, INFRASTRUCTURE WORKS etc. Dynamic Cables has a presence across India & many overseas countries, our brand enjoys a high recall value due to its trust inspiring quality. Our Success is based on clear focus on Product, Process, quality and performance. Modernization and compliance with the ever changing requirement in the industry are mandatory to operate. Keeping that in view the company has "Three" state of the art & modern manufacturing & testing facilities, located in Rajasthan.

The Products manufactured are CE Certified and are type tested from internationally recognized Testing Labs Such as CPRI, ERDA & Tag Corporation. Our manufacturing facilities at Jaipur are certified with ISO: 9001:2015, ISO 45001:2018 and 14001: 2015 ICL (Intertek Certification Ltd. UKAS, UK) certified, enabling them to ensure optimum efficiency in the workflow with compliances towards health and safety.

With a wide array of product range at our disposal, by continuing its investments and improving its production on a balanced basis, Dynamic Cables aims to provide employment opportunities and reach a high level of customer satisfaction and serve the global economy at this way.

During the year we flagged off a strategic cost optimization initiative - Project AROHAN. We are quite optimistic that it will help us build a lean cost structure, which is sustainable while institutionalizing new ways of working. While the implementation is still underway and benefits will accrue over the next few years. We have identified and are unlocking significant value already. We have embarked on a transformational journey whereby we aspire to grow multifold with market share improvement across categories. We are at an inflection point of our organizations growth trajectory and the next five years will be driven by customer-centricity, future-ready organization structure, digital transformation, and a sharp focus on Environment, Sustainability and Governance. We are dedicated to using our resources in a responsible manner. Our endeavor to serve the communities, have a positive impact on environment and ensuring corporate governance form an integral part of our business.

Sector Analysis:

Historically, Indian power sector has been characterized by power-cuts, economic losses, system inefficiencies and archaic last mile networks. While the sector has been undergoing an overhaul over the last few years, the coronavirus pandemic underscored the need of accelerated technological upgradation. The focus on implementation of smart technologies like an evolved grid system, smart metering, and digital asset management will help transform the seemingly traditional, manpower-heavy sector into a smarter, more efficient power system.

Renewable energy is expected to form 70% of fresh capacity expansion expected over the next 5 years. This would help achieve Indias commitment to increase renewable share in total generation to 40% by fiscal 2030 from current 25% as part of the Paris climate deal. According to International Energy Agency (IEA), India would be the largest contributor to the renewable upswing in 2021, and the countrys annual additions are expected to double in 2021 compared to 2020.

While the sector has been undergoing an overhaul over the last few years, the coronavirus pandemic underscored the need of accelerated technological upgradation. Going forward, the focus on implementation of smart technologies like an evolved grid system, smart metering, and digital asset management will help transform the seemingly traditional, manpower-heavy sector into a smarter, more efficient power system with each element in the value chain re-imagining their processes and streamlining infrastructure. Over the last few years, Indian power sector has undergone a significant transformation that has redefined the industry outlook through path-breaking policy initiatives like UDAY, Power for All, UJALA, among others. While discoms reforms have achieved limited financial success, recent policy reforms like payment security mechanism, power-cut penalization, Electricity Amendment Bill will go a long way in bringing in efficiencies into the sector.

A lions share of investment in power sector has flown into adding generation capacities. But in order to ensure reliable and uninterrupted flow of electricity, every megawatt of new generation capacity needs to be matched with a certain transformation capacity added to the system. Going forward, significant development in the transmission sector would be triggered by the aggressive renewable expansion plans. Large scale grid connected solar and wind plants are usually located in the far-flung areas, where there is limited existing transmission infrastructure.

Renewable power generating companies have urged for adequate grid availability in the past. With the renewed government focus on alleviating congestion, providing reliable power to all and strengthening inter-regional grid availability, transmission capacities are expected to grow at a robust pace in 2021.

NIP & Budget allocation

In 2019, the Union Government announced the National Infrastructure Pipeline, with a proposed outlay of 102 lakh crore to execute over 7,000 projects, over a five-year period. This significant push from the government has increased Indias overall potential by manifold, and has presented direct and indirect players in the infrastructure value-chain with a momentous opportunity. Electricals industry is a beneficiary of this, as growth in infrastructure will drive derived demand for wires, cables and other electrical products such as lights, switchgears, and so on.

Private CAPEX

Even as private capex was delayed with the onset of the COVID-19 pandemic, a pickup in investments in Q3 FY21 was led by 102% rise, while Q4 witnessed 40.58% growth in fresh investment in manufacturing investments. As per multiple economic reviews, India is at the cusp of a multi-year capex cycle, and a sustainable private ordering growth over medium term.


One of the key drivers of development through which, every inhabited village of India stands electrified today. Various state and central government policies continue to place emphasis on affordable and accessible electricity, and the electrification drives are expected to gain further momentum. The National Electricity Policy (NEP) 2021 focuses on quality power and accelerated investments through PPP in electricity distribution.

Urbanization, Smart cities, housing for all

With the building of smart cities and foreign and domestic investments, urbanization in India is progressing at a never-before scale. This is complemented by the Union Governments ambitious Housing for All scheme, which is expected to culminate in 2022, with a support for a total of 1.1 crore houses under PMAY (U) and 2.1 crore under PMAY (G).

Export reforms

• Conducive export policies announced by the government include:

• Remission of Duties and Taxes on Export Products Scheme (RoDTEP)

• Ease of doing business enhanced with digitalization, including measures such as Duty exemption authorization, and e-transfer of duty credit scrips, among others.

• Global Wires and Cables market and export prospects

The wires and cables market size globally is estimated at $140-150 billion, which is expected to grow in mid-single digits. The global growth drivers for the industry include rising urbanization, industrialization and growing infrastructure. Additionally, increasing investments in smart upgrading of power transmission and distribution systems, smart grid development and accelerated demand for internet connectivity increased digitalization on account of COVID-19 are expected to drive market growth.

Our response

We at Dynamic Cables are cognizant of these opportunities and have undertaken various efforts, leveraging our strengths as below, which also play an important role in planning our future strategies.

• Robust manufacturing infrastructure with in-house R&D capabilities

• Enhanced marketing presence

• Focus on high-quality premium business segments

• Robust strategies to meet growing demand

• Rapid product innovation

• Green range and energy-efficient products in both wires and cables

• Higher focus on automation, digitization and optimization

• Boost export performance

• Right product mix to accelerate market presence and enhancing bottom line

SWOT Analysis Strengths:

1. Experienced Promoters/Directors/Senior management personnels with motivated and efficient work force.

2. Growing sector, global marketing network, robust manufacturing infrastructure, latest technology and right product mix with high quality

3. Generation of good cash flow, cost optimization and right capital allocation

4. Strong financial profile, zero promoters pledge and investment grade external rating


1. Company has to mainly depend on the financially weak SEBs & CEBs for its sales. Though the payment is almost secure but the delay in payment is normal feature.

2. Uncertainty and slow pace of reforms.

3. Macroeconomic challengers which constrain public and private funding.


1. The Government is focusing on increasing the penetration of power supply in villages.

2. Expansion of key industry sector like power and related sectors.

3. Per capita consumption of energy being relatively low, the growth potential for this industry in medium and long term is high.

4. Governments focus on improving health of Electricity Boards through various schemes and other measures.


1. Stiff competition in the Cables & conductors industry.

2. Technological changes

3. Any unfavorable change in Govt. Policies may affect the profitability of the company.

4. Scarcity of technically skilled personnel.

Segment-Wise or Product-Wise Performance

One of the most powerful drivers that have contributed to the emergence of technological advancements in the Manufacturing sector in India is Governments increasing focus on the concept of ‘Atmanirbhar Bharat or ‘Self-reliant India.

We have developed products such as MVCC, Railway signaling cables, 66kv HV cables, to cater to the growing requirements of power distribution network. As the technological requirement grows across transmission, generation and distribution, we have tried to develop and focus on the products which cater to the future requirements of the industry. Our R&D department is currently working on EEIV cables/ new design family of conductors to cater to the growing distribution requirements and optical fibre cables for the transmission sector.

Customer segment wise Sales break-up:

SEGMENT Sales (Rs. in Lakhs)
GOVT. 4678
PVT 26340
TOTAL 34266

Product wise Sales break-up:

PRODUCT Sales (Rs. in Lakhs)
HT CABLE 18161
LT CABLE 11787
Total 34266

There is a growing trend in sustainability-driven innovation in the manufacturing sector. Covid-19 has put forth an opportunity for us to reinvent our products and services to meet new demands and achieve market advantages through sustainability initiatives. If utilized accurately, lloT can play a major role in bolstering the manufacturing sector. We are trying to re-align our strategies and operations with the latest technology innovation towards the goal of Atmanirbhar Bharat. Invested focus on transitioning from industry 2.0/3.0 to industry 4.0 shall help us cut costs, efficiency in processes; reduce dependence on humans and thus transition towards smart manufacturing.

Government initiatives towards investment in power and infrastructure will remain major contributors to growth in the future Increased infrastructure spending by the government will boost growth in cables and wires as new construction activities will increase demand for elastomeric and flexible cables, development in infrastructure drives growth for commercial and industrial buildings thus increasing demand for building wires and LV cables. Demand for fire survival cables will be supported by metro, airport and commercial real estate projects.

Overall construction spends in key infrastructure sectors to rise over the next 5 years, aided by several recent policy reforms. Roads are expected to drive the majority of the construction spend: investments in urban infrastructure, irrigation, and railways are expected to grow at a fast pace.

The governments investment focus on smart cities and metro construction in major Indian cities will drive growth for various types of cables and wires. Metro projects shall be the second-largest urban infrastructure investment contributor over the next five years. CRISIL Research estimates construction spends on metros to increase 1.9 times to approximately 1.1 trillion over fiscals 2019-2023. The government has promoted increased electrification in rural areas with schemes such as DDUGJY, Saubhagya, Uday and Ujala. Such policies are to act as a catalyst for increasing the rural penetration.

The Indian government initiative of launching projects such as 100 smart cities and ‘Housing for AH are also expected to immensely drive the residential construction market in the country. India has also evinced significant interest from foreign investors in its infrastructural sector.

Industry Outlook

In the wake of the challenges of a global pandemic, nationwide lockdown, unprecedented collapse in countrys economic activity and GDP, 2020 has also left behind a lot of learning. The world as we know it has changed and with it has emerged a new perspective to face challenges by constantly evolving and pre-empting the changing need of the consumers and businesses. While the power demand is expected to slowly limp back to high-single digits in tandem with GDP growth several over-arching fundamental trends are expected to drive the sector transformation in 2021.

India Ratings and Research (Ind-Ra) opines the revenue growth at about 11% CAGR witnessed over FY11-FY20 in the cables and wires industry could continue even during the next decade.

The growth is likely to be backed by continued urbanisation, higher infrastructure spending, increase in electrification and data communication rising demand of wire and cable from various end- users is the driving factor behind the growth of this market. In India, the wire and cable market comprises nearly 40 per cent of the electrical industry. It is growing at a CAGR of 15 per cent thanks to the growth of the power and infrastructure sectors in the country. Moreover, global investors now consider India as a potential market for high voltage (HV) and extra high voltage (EHV) cables.

Primary Market Drivers

• Rising urbanisation and industrialisation in developing countries are driving the growth of this market

• Increasing demand for self-driven vehicles is another factor driving the growth of this market

There is still lot of potential for growth in the turnover of the Company because the demand of Companys products in the market is fast increasing. The Company is specially developing an innovative and different type of product as per requirement of the market. There is a strong demand of in the market hence management has planned to expand its production capacity to cater the increased demand.

We are encouraged by the governments continued efforts to calibrate our health infrastructure, Initiatives like Atmanirbhar Bharat, National Infrastructure Pipeline and the recently introduced production linked incentives (PLIs) to bolster domestic manufacturing augurs well wires and cables industry. Favorable developments on account of policy reforms, normal monsoons, easing of liquidity position, reduction of interest rates and boosting entrepreneurship with initiatives for MSMEs strengthen the case for India becoming a $5 trillion economy. These structural developments offer tremendous growth potential, and we intend to work relentlessly, leverage our core competencies and stay ahead of the curve.

Risk and Concerns

Increasing volatility in the cost of raw material is restraining the growth of this market

The international wire and cable market is extremely fragmented and the major players in the sector have used myriad strategies including new product launches, expansions, agreements, joint ventures, partnerships, acquisitions, etc. to widen their presence in this market.

COVID-19 has impacted on the business of the company and this cannot be ascertained how long this impact continues on the business, but for the betterment management has taken all the precautionary measures to keep the business stable and sustainable.

Internal Control System and Their Adequacy

The Company has adequate internal control system, commensurate with the size of its operations. Adequate records and documents are maintained as required by laws. The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations. The Audit Committee gives valuable suggestions from time to time for improvement of the companys business processes, systems and internal controls. All efforts are being made to make the internal control systems more effective

Discussions on Financial Performance with respect to operational performance

Financial performance of the Company has been good despite of an adverse economic environment and your company is doing well on fulfilling its objectives of growth, profitability and maximization of shareholders wealth.

The overview of financial performance with respect to operational performance of the Company can be obtained from the various following ratio analysis:

2020-21 2019-20
Debtors Turnover Ratio Revenue from Operations 34,266.20 2.47 42,859.01 2.83
Average Debtors 13,898.20 15,154.28
Inventory Turnover Ratio Revenue from Operations 34,266.20 5.03 42,859.01 8.32
Average Inventory 6,819.03 5,152.23
Interest Coverage Ratio EBIT 2,527.38 2.13 3,918.11 2.55
Interest Cost 1,188.91 1,535.86
Current Ratio CA 24,073.73 1.64 24,111.17 1.69
CL 14,658.00 14,253.15
Debt Equity Ratio Total Debts 11,761.82 1.00 12,213.58 1.13
Equity 11,717.03 10,784.73
Operating Profit Margin EBITDA excluding Other Income 2,562.80 7.48% 4.502.71 10.51%
Revenue from Operations 34,266.20 42,859.01
Net Profit Margin PAT 984.50 2.87% 1,822.69 4.25%
Revenue from Operations 34,266.20 42,859.01
Return on equity PAT 984.50 8.40% 1,822.69 16.90%
Net worth 11,717.03 10,784.73
Return on Capital Employed EBIT 2,527.38 10.76% 3,918.11 17.04%
Capital Employed 23,478.85 22,998.31
Return on Assets PAT 984.50 3.32% 1,822.69 6.09%
Total of Balance Sheet 29,675.88 29,946.55

Material Developments in Human Resources / Industrial Relations Front Including Number of People Employed

The Company always believes that its growth is closely linked with the growth and overall development of its employees and to create an environment where excellence is recognized and rewarded. The target is to place right people at right position and to enhance the efficiency, working speed, competency and time management skill of its employees. The Companys endeavor is to create an environment where people can use all of their capabilities in promoting the business of the Company. Number of on rolls people employed as on March 31, 2021 is 552.

Cautionary Statement

Statement in the Management Discussion and Analysis and Boards Report describing the Companies Strengths, strategies, projection and estimate are forward looking and progressive within the meaning of all applicable laws and regulation. Actual results may vary depending upon the various aspects of the economic such as Government policies, Rules and Regulations, economic conditions and other incidental factors. Important factors that could make a difference to our Companys operations include raw material availability and prices, cyclical demand and pricing in our principal markets, changes in government regulations, tax regimes, economic developments within India and outside the countries in which we conduct business and other incidental factors. Management will not be in any way responsible for the actions taken based on such statements.

Place: Jaipur For and on behalf of the Board of Directors
Date: August 08, 2021 For Dynamic Cables Limited
Rahul Mangal
(DIN: 01591411)
Registered Office:
F-260, Road No. 13, VKI Area, Jaipur 302013 (Rajasthan)