Staying Ahead of the Pack

Research evidence excerpt

Staying Ahead of the Pack

Despite absorbing a sharp increase in imported fuel costs during 1Q, UTCEM maintained per-

ton profitability. Co is targeting ~Rs1400/T EBITDA for 4QFY28 (~Rs1250 for 4QFY26). Mgmt

Exhibit 1 - UTCEM: Key Financials and

indicated that cost Inflation during 1Q was largely confined to fuel (+Rs40/T) and packing bags assumptions

FY24 FY25 FY26 FY27e FY28e FY29e(+Rs20/T); full impact of the recent geopolitical disruptions is expected to be reflected in 2Q, (Rsmn)Revenue 709,081 759,551 885,115 1,016,250 1,131,921 1,248,632

implying an incremental variable cost increase of ~Rs130-140/T for the industry, which could EBITDAYoY % 129,68622% 125,575-3% 170,20236% 193,47614% 237,44723% 273,14315%

be partly mitigated through cost saving measures. PATEPS 70,770245 61,365208 82,696281 100,500341 130,612443 156,054530

Vols (mnT) 119 136 154 172 188 205

YoY% 12% 14% 14% 11% 10% 9%

Mgmt discussed importance of Brand in Cement: Mgmt reiterated that India remains CapacityEBITDA/T(MTPA)(Rs) 1,089146 189926 1,103197 1,126213 1,261233 1,332242

predominantly an IHB market, supporting the importance of branded cement. RMC penetration ROCEEV/EBITDA(%) (x) 15.327.2 10.929.3 12.621.6 14.319.1 17.515.3 19.313.0

is still low %age of total cement consumption, leaving significant room for growth. As long . EV/TP/E (x)(USD) 48.5291 57.1230 42.4212 34.9185 26.8164 22.5154

Source: Company; Jefferies

as the market continues to be retailled, management believes branded cement will continue

to command a premium. For UltraTech, retail accounts for ~65-66% of sales, institutional

customers contribute ~35%, while only ~3.5% of cement volumes are sold to the RMC segment

Cables/Wires business on track for launch: UltraTech’s wires/cables biz remains on track for