Should shareholders of Havells, KEI, Polycab, RR Kabel & Finolex sweat because AV Birla Group is getting into their business?

First it was the paint industry, and this week it was the turn of stocks of the wires & cable sector to suffer cuts because the heavyweight Aditya Vikram Birla Group announced its entry into the industry. The stocks of wires & cable companies saw dramatic drops as soon as the announcement was made. Is this an over-reaction, similar to what the street witnessed when the AV Birla Group recently entered the paint industry? Probably not. There is a big difference between the paint and the wires & cable industries, even though their products are related to home building.