Usha Martin Limited has approved the sale of the entire business undertaking of its wholly owned subsidiary, U M Cables Limited (UMCL), to R R Kabel Limited for a lump sum consideration of ₹77 crore. The transaction, structured as a slump sale on a going concern basis, marks UMCL's strategic entry into the optical fibre cable segment while allowing Usha Martin to streamline its portfolio.

The Board of Directors of both companies approved the deal on September 24, 2026. UMCL is engaged in manufacturing and selling optical fibre and related cables. The purchase price is subject to certain working capital adjustments and the fulfilment of conditions precedent outlined in the Business Transfer Agreement (BTA). Upon completion, UMCL will continue to be a wholly owned subsidiary of Usha Martin, as no equity shares are being transferred.

Strategic rationale and portfolio focus

For Usha Martin, the acquisition aligns with its strategy to streamline its portfolio and sharpen its focus on its core wire and wire ropes business. The company stated that the divestiture is expected to enable more efficient deployment of capital towards its long-term growth priorities. Conversely, for R R Kabel, the acquisition supports its objective to diversify its product portfolio by entering the communication cable market, enhancing operational capabilities in the telecommunications infrastructure sector.

The target entity has been incorporated since July 7, 1987, and operates exclusively within India. The transaction does not involve the acquisition of shares but rather the transfer of the entire business undertaking. Consequently, no governmental or regulatory approvals were cited as prerequisites for this specific transfer structure, although standard BTA conditions apply.

Target financial performance

UMCL’s turnover has witnessed a decline over the last three fiscal years. The data indicates a contraction in revenue from FY24 to FY26, reflecting potential market headwinds or operational challenges within the target entity prior to the acquisition.

In FY26, UMCL's revenue from operations was ₹78.19 crore, representing approximately 2.12% of Usha Martin's consolidated revenue from operations of ₹3,691.06 crore. As of March 31, 2026, UMCL's audited net worth was ₹35.32 crore, accounting for approximately 1.07% of Usha Martin's consolidated net worth of ₹3,302.08 crore.

The deal is expected to be completed within 60 days from the execution of the BTA, or as mutually agreed upon by both parties, provided all conditions are satisfactorily met. The buyer, R R Kabel, is unrelated to Usha Martin or its promoter group, ensuring the transaction is not classified as a related party transaction.

What the numbers show

The acquisition price of ₹77 crore stands in stark contrast to UMCL’s recent revenue trajectory. While the company generated ₹7,818.64 lakh (approximately ₹78.2 crore) in turnover during FY26, the lump sum purchase consideration of ₹77 crore implies an enterprise value roughly equivalent to one year of recent revenue. This valuation suggests that R R Kabel may be pricing the asset based on its tangible assets, customer contracts, or strategic entry value rather than historical earnings power, especially given the significant year-on-year decline in UMCL’s top line from ₹13,534.48 lakh in FY24 to ₹7,818.64 lakh in FY26. Furthermore, the contribution of UMCL to Usha Martin's consolidated metrics remains minimal, with less than 2.5% of consolidated revenue and roughly 1% of net worth, indicating that the divestiture will have a limited immediate impact on Usha Martin's overall financial scale.

RR Kabel has scheduled a plant visit for institutional investors and analysts in Vadodara. The event is set for September 23, 2026, and will feature direct interaction with company officials.

The disclosure was made pursuant to Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company confirmed that no unpublished price-sensitive information will be shared during the meeting.

Event Details

The visit is organized as part of the company's corporate communication strategy to engage with the investment community. Key details of the schedule are outlined below:

The company noted that the date and participants are subject to change due to exigencies on the part of the analysts, institutional investors, or the company itself.

Compliance Note

Anup Vaibhav C. Khanna, Company Secretary and Compliance Officer, signed the intimation. The filing emphasizes adherence to listing obligations regarding investor relations activities.