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UltraTech Cement — Q3 FY26
UltraTech delivered a strong Q3 FY26, with volume growth outpacing the industry at an estimated 9-10% all-India demand growth.
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UltraTech delivered a strong Q3 FY26, with volume growth outpacing the industry at an estimated 9-10% all-India demand growth. The company's EBITDA per ton improved despite subdued cement prices, driven by operating leverage and cost efficiencies. Lead distance dropped to 363 km and clinker conversion factor improved to 1.49, both ahead of targets. Management expects Q4 utilization to exceed 90% and guided for 8-9 million tons of capacity addition in Q4, with 12 million tons in FY27. Pricing has improved by INR 3-4/ton in January. Risks include potential cost inflation from petcoke/coal and rupee depreciation, though management expressed confidence in passing through costs. The integration of Kesoram and India Cements is ahead of plan, with brand conversion at 69% and 58% respectively.
अल्ट्राटेक ने वित्त वर्ष 2026 की तीसरी तिमाही में शानदार प्रदर्शन किया। कंपनी की बिक्री (वॉल्यूम) में 9-10% की बढ़ोतरी हुई, जो पूरे देश की मांग से ज़्यादा है। सीमेंट के दाम कम होने के बावजूद, कंपनी का मुनाफा (EBITDA) प्रति टन बेहतर हुआ। इसकी वजह है कम लागत और बेहतर संचालन। सीमेंट ढुलाई की दूरी घटकर 363 किमी रह गई और क्लिंकर बनाने की दर 1.49 पर आ गई, जो लक्ष्य से बेहतर है। कंपनी को उम्मीद है कि चौथी तिमाही में 90% से ज़्यादा क्षमता इस्तेमाल होगी। वे चौथी तिमाही में 8-9 लाख टन और अगले वित्त वर्ष में 12 लाख टन क्षमता बढ़ाएंगे। जनवरी में सीमेंट के दाम 3-4 रुपये प्रति टन बढ़े हैं। जोखिम में कोयले की बढ़ती कीमत और रुपये की गिरावट शामिल है, लेकिन कंपनी का कहना है कि वे लागत वसूल सकते हैं। केसोराम और इंडिया सीमेंट्स का विलय योजना से आगे है, जिसमें 69% और 58% ब्रांड बदलाव हो चुका है।
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Cost inflation from petcoke/coal and rupee depreciation
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Lead distance
363 km
-37 km vs target of 400 km
Lead distance reduced to 363 km, better than the 375 km interim target, driven by logistics optimization.
Clinker conversion factor
1.49
-0.05 vs target of 1.54
Clinker factor improved to 1.49, ahead of the 1.54 target, reducing clinker usage and costs.
Kesoram brand conversion
69%
+69pp since acquisition
Brand conversion at Kesoram reached 69% by December 2025, ahead of initial plans, enabling better pricing.
India Cements brand conversion
58%
+58pp since acquisition
India Cements brand conversion crossed 58% by December 2025, ahead of schedule, improving market reach.
What Changed vs Last Quarter
NEW
Q4 FY26 capacity addition of 8-9 million tons
Approximately 8-9 million tons of new capacity will be commissioned in Q4 FY26, part of the ongoing expansion.
NEW
FY27 capacity addition of 12 million tons
12 million tons of capacity to be added in fiscal 2027, with the remainder of the 22 million ton phase in FY28.
NEW
Net debt/EBITDA to reach 0.89x by end of FY26
Management expects net debt/EBITDA to improve from 1.08x to 0.89x by March 2026, driven by cash flows.
NEW
Cable & wires product launch in Q3 FY27
The new cable and wires business is on schedule for product launch in the October-December 2026 quarter.
DROPPED
Capacity target of 200 MTPA by FY26 end
UltraTech will exit the current financial year with 200 million tons of cement capacity.
DROPPED
Next phase expansion of 22.8 MTPA in North and West
Incremental capacity of 22.8 million tons (18 MTPA North, 4.8 MTPA West) to be completed by FY28-29, largely brownfield.
DROPPED
ICL EBITDA per ton to reach INR 1,000 post expansion
India Cements assets will generate EBITDA per ton of INR 1,000 and net debt/EBITDA of ~0.5x after expansions are operational.
DROPPED
Kesoram EBITDA per ton to cross INR 1,000 by June 2026
Kesoram assets expected to achieve EBITDA per ton of INR 1,100-1,200 by end of June 2026 after WHRS and brand conversion.
NEW RISK
Cost inflation from petcoke/coal and rupee depreciation
Management noted cost increases in petcoke and coal, and potential impact from rupee depreciation, which could pressure margins if not passed through.
NEW RISK
South India pricing volatility despite consolidation
Analyst questioned why South India pricing remains volatile despite industry consolidation; management attributed it to demand but acknowledged historical volatility.
NEW RISK
ED case attached to India Cements assets
An Enforcement Directorate case has attached two assets of India Cements, potentially delaying non-core asset sales and cash generation.
NEW RISK
Execution delays in capacity expansion
Management admitted possible delays of up to a quarter in commissioning new capacity, which could impact volume growth targets.
RISK GONE
Potential oversupply in northern markets
Multiple peers (JK, Dalmia, JSW) are also expanding in the North, which could lead to pricing pressure.
RISK GONE
One-off cost impact may not fully reverse
Management expects ~INR 100/ton reversal in Q3, but some costs (e.g., maintenance) may persist at lower levels.
RISK GONE
Fuel cost volatility from petcoke
Petcoke prices have moved up; though management expects no net inflation, spot purchases could increase costs.
🤫 Topics management stopped discussing
Mentioned in Q1 FY25, Q1 FY26, Q2 FY25, Q3 FY25, Q4 FY25
Management expects consolidated volume growth of over 10% in FY26, driven by new capacities and market demand.
Mentioned in Q1 FY26, Q2 FY25, Q2 FY26
Petcoke prices have moved up; though management expects no net inflation, spot purchases could increase costs.
Mentioned in Q1 FY26, Q2 FY25, Q3 FY25
Management noted that north and west regions have not seen price increases as they are already well-priced, posing a risk to margins if competition intensifies.
Mentioned in Q1 FY26, Q3 FY25
Capital expenditure for the current fiscal year is expected to be around INR 10,000 crore.
Mentioned in Q1 FY25, Q4 FY25
The company targets cost savings of over ₹300 per ton on existing UltraTech operations by the end of FY27, with ₹86 already achieved in FY25.
Fast read
Guidance and risk preview
Approximately 8-9 million tons of new capacity will be commissioned in Q4 FY26, part of the ongoing expansion.
Management noted cost increases in petcoke and coal, and potential impact from rupee depreciation, which could pressure margins if not passed through.
View Risks →