UltraTech Cement Ltd. share price target

Industry leader UltraTech Cement (UTCEM) has put up a good show for Q4FY23 with – a) volumes racing >14% YoY, b) realisation drop arrested to a mere ~1% QoQ, c) variable cost/t coming off >3% QoQ and d) fixed cost increase restrained at just 5.5% YoY/3% QoQ.

Pricing power is crucial in the commodity business and the Indian cement sector is certainly losing the plot on that front. Elevated competitive intensity across regions, has prevented margin-accretive price hikes, despite: a) robust demand (Q4FY23E prices slipped ~1% QoQ notwithstanding peak season volume surge of ~10% YoY)

The Ultratech Cement has completed an ‘Inverted Head and Shoulder’ pattern, very bullish and in a throwback, the neckline has tested. The overlapping zone, Q1 and Q2 21-22 is working as resistance. Once this zone gets cut, there will be a strong up move. The current trend is bullish.