Synopsis:
UltraTech Cement stock is in focus after both Morgan Stanley and Bank of America have given an upside of 11 percent and 15 percent respectively.
The shares of this flagship brand of Grasim Industries are in focus as both Morgan Stanley and Bank of America have reiterated their Buy call on the stock. In this article, we will dive deep into the details of it.
With a market capitalisation of Rs 3,64,518 crores, the shares of Ultratech Cement are currently trading at Rs 12,370 per share, down by just 2.7 percent from its 52-week high of Rs 12,711.95 per share. Over the past five years, the stock has delivered a robust return of 229 percent.
Analyst Viewpoints
Bank of America (BofA) has maintained a Buy call on the stock and has raised its target price from Rs 12,300 to Rs 14,440, signalling an upside potential of 15 percent from its previous day closing price of Rs 12,577 per share.
The brokerage cited that UltraTech Cement’s performance in the June quarter was a bit of a mixed bag. While they saw weak volume growth, their profitability execution was quite strong.
They also noted that the dip in volumes is expected to continue throughout the current financial year, even though UltraTech has strengthened its capacity by acquiring the cement businesses of India Cements and Kesoram Industries.
On the other hand, Morgan Stanley maintained an Overweight rating on the stock and kept its target price unchanged at Rs 14,000, signalling an upside potential of 11.31 percent from its previous day closing price of Rs 12,577 per share.
The brokerage cited that UltraTech has once again showcased impressive performance this quarter, solidifying its reputation as a leading choice in the cement industry.
Morgan Stanley views it as a long-term earnings powerhouse, backed by steady market share growth, various revenue streams, and a strong commitment to cost efficiency.
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Financial Highlights
Ultratech reported a revenue of Rs 21,275 crore in Q1 FY26, up by 13 percent from its Q1 FY25 revenue of Rs 18,819 crore. On a quarterly basis, it declined by 7.75 percent from Rs 23,063 crore.
Coming to its profitability, the company reported a net profit growth of 49 percent to Rs 2,221 crore in Q1 FY26 as compared to Rs 1,493 crore a year ago. On a quarterly basis, it declined by 10.26 percent from Rs 2,475 crore.
The stock delivered an ROE and ROCE of 9.34 percent and 10.93 percent respectively, and is currently trading at a P/E of 52.76x as compared to its industry average of 53.59x.
UltraTech Cement Ltd stands out as one of India’s top cement manufacturers, offering a wide range of products including Portland cement, white cement, and ready-mix concrete.
They also provide various construction essentials like wall putty, dry mix mortars, and waterproofing solutions. On top of that, the company is making strides in renewable energy with initiatives in wind and solar power. Plus, they operate retail stores that sell building materials such as steel, paints, and tiles.
Written by Satyajeet Mukherjee
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