Indian Govt Plans ₹10,000 Cr VGF Scheme to Boost Underground Cable Manufacturing; Big Boost for $KEI & $POLYCAB

The Indian government is reportedly planning a significant Viability Gap Funding (VGF) scheme worth around ₹10,000 crore aimed at accelerating domestic manufacturing of underground power cables. This initiative seeks to support the shift from overhead lines to safer, more reliable underground cabling networks across urban and infrastructure projects. This amid broader government pushes under schemes like the Revamped Distribution Sector Scheme (RDSS) with its ₹3+ lakh crore outlay for modernizing power distribution, including undergrounding to reduce outages and improve aesthetics/safety. The scheme is expected to catalyze private investment, capacity additions, and technology upgrades in underground cable manufacturing, fostering self-reliance under Make in India and PLI-like incentives. Positives include accelerated order inflows for domestic players, job creation in manufacturing and EPC, lower import dependence, and enhanced power infrastructure quality—reducing technical losses (potentially saving hundreds of crores annually as seen in similar projects), minimizing outages, and supporting renewables integration. This will positively influence cable manufacturers and related EPC players in the coming quarters like KEI Industries, $POLYCAB , $RRKABEL , $HAVELLS , and $FINCABLES for wires & specialty segments. Ancillary gains for EPC firms like Rajesh Power Services, Advait Energy Transitions, and transmission players involved in underground projects. Broader ripple effects on conductors/transformers (e.g., via RDSS/Green Energy Corridor) and raw material suppliers.