Ultratech Cement (UTCEM IN) – Q2FY27 Result Update – Cost headwinds today, growth momentum intact – BUY
Published on 19 Oct 2026
Mgmt. remains constructive on demand supported by housing, infrastructure, data centres, semiconductors and urban redevelopment. The key monitorable remains pricing, with spot realizations already ~5% above the Q2 average and further hikes expected to offset elevated fuel costs. While West Asia-led cost inflation remains a near-term headwind, UTCEM’s scale, operating leverage and ability to pass on cost increases should support earnings recovery. Mgmt. also indicated that existing capacity is increasingly stretched, reinforcing the need for the next expansion phase beyond 240mt. We believe UTCEM remains well positioned to sustain industry outperformance, backed by disciplined capacity additions, pricing sustainability and cost efficiencies. We maintain our FY28/29E EBITDA estimate and expect UTCEM’s volume/EBITDA to deliver a CAGR of 12%/14% over FY26-29E The stock is trading at EV of 14.2x/12.6x FY28/29E EBITDA. Maintain ‘BUY’ with TP of INR14,623 (earlier INR14,691) valuing at same 18x EV of Sep’28E EBITDA.
