UltraTech Cement Ltd. share price target

We maintain our BUY rating on the stock.

UltraTech Cement’s capacity expansion remains a cornerstone of its growth strategy. By FY25, its cement capacity is projected to reach 182.8 million tonnes (28% of India’s total cement capacity) with plans to scale it to 209 million tonnes by FY27, through both organic and inorganic growth.

UTCEM allocates Rs18bn (~2% of capital allocation) in the building material value chain by investing in wire and cable business

We recommend a BUY on the stock for a target price of Rs 12,385 implying an upside of 10% from CMP

• UltraTech Cement’s earnings for Q3FY25 exceeded our expectations, while revenue aligned with our forecasts.
• Revenue for Q3FY25 came in at INR 171,933 Mn, up 2.7% YoY (+10.0% QoQ). The QoQ growth was driven by higher realization and robust volume expansion.

We maintain our BUY recommendation on the stock.

UltraTech Cement (UltraTech) reported broadly in-line standalone revenue at Rs. 16,328 crore (up 1.2% y-o-y) for Q3FY2025, led by strong volume growth of 10.6% y-o-y, while blended realizations were lower 8.5% y-o-y. Blended standalone EBITDA/tonne stood at Rs. 965, down 20.2% y-o-y while a good improvement of 31.9% q-o-q.

Healthy 10% YoY volume growth aids flat topline despite 9% dent in realisations in a challenging Q3; capacity utilisation at ~76%

UltraTech Cement’s (UTCEM) 3QFY25 operating performance was in line with our estimate, with EBITDA standing at INR28.9b (declined 11% YoY). EBITDA/t stood at INR951 (-20% YoY; vs. est. INR925).

Steady 3% volume growth aids marginal fall in topline despite dent in realisations in a challenging Q2; capacity utilisation at ~68%

UltraTech Cement’s earnings for Q2FY25 exceeded our expectations, while revenue aligned with our forecasts.
Revenue for Q2FY25 came in at INR 156,347 Mn, down 2.4% YoY (-13.5% QoQ) was largely in line with our estimates.

UltraTech Cement’s (UTCEM) focus on increasing its capacity/market share and enhancing efficiency remains heartening. However, in Q2FY25, the sectoral pangs of subdued demand and weak prices got the better of the industry leader.

We maintain our BUY rating on the stock with a TP of Rs 12,000/share, implying an upside potential of 10% from the CMP.

UltraTech Cement (UTCEM)’s 2QFY25 EBITDA was below our estimate due to higher-than-estimated opex/t. EBITDA declined ~21% YoY to INR20.2b (7% miss).

Standalone revenue stayed in-line, although volume growth marginally lagged for Q2FY2025. Operational profitability miss was led by operating de-leverage.