Ultratech Cement Ltd, a part of Aditya Birla Group. The company operates in the manufacturing of cement and ready-mix concrete. Its core activities revolve around the manufacturing and distribution of various cement products, predominantly within India.
On Thursday, UltraTech Cement Ltd. shares were quoted at ₹11,543 per share, a decrease of 1% on the National Stock Exchange. The company has a market capitalization of ₹3,32,741 crores.
Ultratech Cement Ltd, a part of Aditya Birla Group. The company operates in the manufacturing of cement and ready-mix concrete. Its core activities revolve around the manufacturing and distribution of various cement products, predominantly within India.
UltraTech Cement Ltd is scheduled to release its Q1 FY25 earnings report on July 19, 2024.
Analysts from various brokerages anticipate muted results for UltraTech due to sluggish demand in the June quarter, attributed to factors such as the general elections, labor shortages, severe heat waves, and monsoons, which have collectively dampened cement demand in Q1.
According to estimates by Bloomberg, analysts expect that the Net profit of Aditya Birla may surge 8.2% year-on-year to Rs 1,828.47 crore in the April-June quarter, and Revenue may rise 3.7% to Rs 18,388.2 crore versus Rs 17,737.1 crore. Margin might expand to 240 basis points to 20.2% versus 17.8%.
HDFC Securities expects UltraTech to report a 7% growth in profit to approximately ₹1,810 crores and a 4.7% increase in revenue to nearly ₹18,091 crores. Conversely, Prabhudas Lilladher forecasts a 0.7% decline in revenue and approximately 1% growth in profit year-on-year.
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Nuvama Research analysts expects the company to see a 7% year-on-year volume growth in Q1 FY25.while Nuvama Research expects the blended realisations to fall 2% quarter-on-quarter on account of the weak pricing environment.
According to BOB Capital Markets, UltraTech Cement has maintained a robust growth rate in the high single digits following a strong Q4FY24, based on keeping prices relatively higher compared to competitors.
They mentioned that despite intense competition, the company achieved a volume growth of about 8.5 percent. They also expect operational efficiencies to improve margins, moving them into positive territory.
According to a Moneycontrol report, UltraTech Cement’s net profit is projected to decrease by 30 percent quarter-over-quarter to Rs 1,733 crore, with revenue also anticipated to drop by 13 percent sequentially to Rs 17,962 crore.
However, compared to the previous year, net profit is expected to increase by 2.5 percent and revenue by 1.3 percent.v
According to Centrum Broking, cement demand in the industry is expected to decline by 3-4% year-over-year. Demand in the western, eastern, and central regions remained stable, while the northern and southern regions are expected to see a contraction and decline in Infrastructure activity muted in the June quarter due to the general elections.
A global research and broking firm, Morgan Stanley has given an Overweight call on the stocks with a target price of ₹13,620 per share.
UltraTech Cement Ltd’s operational revenue has increased by 12 percent yearly, from ₹63,240 crore in FY22-23 to ₹70,908 crore in FY23-24. During the same period, net profit rose by 38 percent, from ₹5,073 crore to ₹7,004 crore.
Earlier, ICICI Direct, a brokerage firm, recommended a buy call on UltraTech Cement Ltd with a target price of ₹12,430. The recommendation is based on UltraTech’s robust capacity expansion strategy, which is expected to drive revenue growth at a compound annual growth rate (CAGR) of around 10.8% from FY24 to FY26.
Additionally, the company management expects EBITDA to rise at a CAGR of 18.1% and PAT at 21.2% during the same period.
UltraTech Cement Ltd’s operational revenue has increased by 12 percent yearly, from ₹63,240 crore in FY22-23 to ₹70,908 crore in FY23-24. During the same period, net profit rose by 38 percent, from ₹5,073 crore to ₹7,004 crore.
UltraTech has a consolidated capacity of 138.39 Million Tonnes Per Annum (MTPA) of grey cement. UltraTech has 23 integrated manufacturing units, 28 grinding units, one clinkerisation unit, and 8 Bulk Packaging Terminals.
The stock has gained a return of 16 percent in the last six months and 40 percent in the last 12 months.
Written by Omkar Chitnis
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