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UltraTech Cement — Q3 FY25
UltraTech delivered a strong operational quarter with EBITDA per ton of INR 964, up over 30% QoQ, driven by price recovery and cost efficiencies.
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UltraTech delivered a strong operational quarter with EBITDA per ton of INR 964, up over 30% QoQ, driven by price recovery and cost efficiencies. Volumes grew ~10% YoY organically, outpacing industry growth of ~5%. Management highlighted a positive demand inflection from December, with further price hikes in January (1.5% in Central/West). The India Cements acquisition (81.49% stake) is expected to be turned around within 12 months, with WHRS and renewable energy investments targeting cost alignment by FY27. Kesoram consolidation is on track for FY25-end. Key risk: potential state-level mineral taxes post-Supreme Court ruling could add cost headwinds.
अल्ट्राटेक ने इस तिमाही में शानदार काम किया। हर टन सीमेंट पर उन्होंने 964 रुपये का मुनाफा कमाया, जो पिछली तिमाही से 30% ज़्यादा है। यह कीमतों में सुधार और खर्च कम करने से हुआ। उनकी बिक्री पिछले साल से 10% बढ़ी, जबकि पूरे उद्योग की बढ़त सिर्फ 5% रही। दिसंबर से मांग बढ़ी है और जनवरी में मध्य व पश्चिम भारत में कीमतें 1.5% बढ़ाई गईं। इंडिया सीमेंट्स कंपनी को खरीदने के बाद उसे 12 महीने में फायदे में लाने की योजना है। केसोराम का विलय मार्च 2025 तक पूरा होगा। खतरा: सुप्रीम कोर्ट के फैसले से राज्य सरकारें सीमेंट पर नया टैक्स लगा सकती हैं, जिससे लागत बढ़ेगी।
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State-level mineral taxes
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EBITDA per ton
INR 964
+30% QoQ
EBITDA per ton jumped over 30% sequentially, reflecting price recovery and cost control.
Lead distance
377 km
-23 km vs start of program
Lead distance reduced from 400 km, contributing ~INR 70/ton benefit.
WHRS capacity
324 MW
+46 MW vs Q4 FY24
Waste heat recovery capacity increased, targeting 511 MW by FY27.
Pet coke share in fuel mix
58%
+8pp YoY
Higher pet coke usage helped reduce fuel cost to INR 1.76/kcal.
What Changed vs Last Quarter
NEW
India Cements turnaround in 12 months
Management aims to improve India Cements' performance to within INR 200-300/ton of UltraTech's EBITDA within 12 months from January 2025.
NEW
CapEx of INR 9,000 crore in FY26
Organic CapEx for UltraTech standalone is guided at ~INR 9,000 crore for FY26, tapering to INR 6,000-7,000 crore in FY27.
NEW
Fuel cost to decline to ~INR 1.7/kcal
Based on current spot prices, fuel costs are expected to trend down to around INR 1.7 per kcal in the near term.
UPDATED
Double-digit volume growth in FY26
UltraTech expects to grow volumes by over 10% in FY26, driven by capacity expansion and demand recovery.
DROPPED
Capacity to reach 157 MTPA by March 2025
UltraTech will commission 8 MTPA in H2, taking total capacity to 157 MTPA by end of FY25.
DROPPED
Cost savings of INR 300/ton through efficiency program
Efficiency improvements in WHRS, renewable energy, clinker ratio, fuel mix, and lead distance are expected to deliver INR 300/ton cost savings by FY27.
DROPPED
Kesoram acquisition to close in Q4 FY25
NCLT hearings scheduled for Oct 25 and Nov 12; transaction expected to conclude by Q4 FY25.
NEW RISK
State-level mineral taxes
Supreme Court ruling allowing states to levy taxes on minerals could increase costs, though management sees limited immediate impact.
NEW RISK
Integration and turnaround of India Cements
India Cements has low utilization (~57%) and requires significant CapEx; turnaround may take longer than 12 months.
NEW RISK
Delay in Kesoram mine approvals
Pending approvals for mines in Telangana and Karnataka could delay consolidation beyond FY25.
RISK GONE
Delays in capacity additions
Industry-wide capacity additions of 30 MTPA per year face execution delays, which could impact supply-demand balance.
RISK GONE
Global fuel cost volatility
Management noted that petcoke sellers are holding inventory, suggesting potential price increases; ocean freight costs could also rise.
RISK GONE
Regulatory delays in acquisitions
CCI approval for India Cements and NCLT approval for Kesoram are pending; any delay could push closure beyond current fiscal.
🤫 Topics management stopped discussing
Mentioned in Q2 FY24, Q2 FY25, Q3 FY24, Q4 FY24
Management noted that petcoke sellers are holding inventory, suggesting potential price increases; ocean freight costs could also rise.
Mentioned in Q1 FY25, Q3 FY24, Q4 FY24
Realizations declined 2.4% YoY and July prices are 1.5% softer sequentially, with no near-term recovery expected.
Mentioned in Q1 FY25, Q2 FY25, Q4 FY24
Despite recent price hikes, industry profitability remains low; if demand recovery falters, prices could remain depressed.
Mentioned in Q1 FY25, Q4 FY24
Management raised the cost reduction target from ₹200-300 to ₹300+ per ton, driven by logistics and WHRS improvements.
Mentioned in Q2 FY25, Q3 FY24
CCI approval for India Cements and NCLT approval for Kesoram are pending; any delay could push closure beyond current fiscal.
Fast read
Guidance and risk preview
UltraTech expects to grow volumes by over 10% in FY26, driven by capacity expansion and demand recovery.
Supreme Court ruling allowing states to levy taxes on minerals could increase costs, though management sees limited immediate impact.
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