Ultratech Cement: Resilient performance amid near-term headwinds

Research evidence excerpt

Ultratech Cement: Resilient performance amid near-term headwinds

Global Markets Research

Ultratech Cement ULTC.NS UTCEM IN 21 July 2026

EQUITY: CONSTRUCTION MATERIALS

RatingResilient performance amid near-term headwinds Remains Buy

Target priceMarginal realization beat lifts 1Q EBITDA; 2QFY26F Remains INR 13,900

EBITDA/t to decline; maintain Buy and TP of INR13,900

Closing price INR 11,903 20 July 20261QFY27 results: Realization improvement partially offset increased costs

1QFY27 EBITDA of INR50bn came in above our and Bloomberg consensus estimates by Implied upside +16.8%4% and 3%, respectively. The beat was on account of slightly better realizations; blended

realization improved 3% q-q vs our forecast of +1% q-q. Ultratech reported 14% y-y Market Cap (USD mn) 36,306.5

volume growth, largely in line with our estimate. Higher packaging costs/t resulted in a 5% ADT (USD mn) 42.7

q-q increase in operating costs/t, 2% above our estimate. As a result, 1QFY27 EBITDA/t

declined just INR40/t to INR1,211/t vs our estimate of INR1,180/t.

Relative performance chart2QFY27F: Costs to rise further; we forecast ~INR200/t q-q EBITDA decline

We expect 2QFY27F realizations to decline 1% q-q as historically 2Q is seasonally weak.

Management indicated toward a INR130-140/t q-q increase in operating costs/t in 2Q,

partly due to the West Asia conflict. We expect 8% y-y grey cement volume growth to

34.6MT in 2Q. Thus, we expect EBITDA/t to decline ~INR200/t q-q to INR1,013/t.

Capacity expansion and execution remain on track

Management reiterated that capacity expansion remains on track; it aims to achieve over

242MT of cement capacity by FY28E. The Cables & Wires segment was noted to be

progressing on schedule and within budget, with INR8.9bn spent or committed out of the