UltraTech Q3 profit beats expectations, helped by cheaper inputs, strong demand

UltraTech posts 67% rise in Q3 profit

Trade

• Watchlist
• Portfolio
• Message
• Set Alert

 

 

Choose Stock Exchange: BSE LIVE NSE LIVE

26 Aug, 2025 12:21

Volume

Todays L/H

More

×

UltraTech Cement posted a 67 percent surge in net profit in the third quarter of FY24, beating expectations, riding on the back of robust demand for the building materials and lower operating costs.

Profit climbed to Rs 1,774.78 crore in the three months ended December from Rs 1,062.58 crore a year earlier, the company said in a statement on January 19.  Analysts expected the company to report a net profit of Rs 1,714.19 crore for the October-December quarter, according to estimates from seven brokerages collated by Moneycontrol.

Revenue from operations climbed 7 percent to Rs 16,739.97 crore. On a sequential basis, revenue rose 4.5 percent and profit surged 38.6 percent.

Cement sales are likely to rise amid increased government spending on infrastructure, rural development and rising demand from the housing sector. India’s cement demand is expected to grow by 6 percent to 8 percent over the next few years, Fitch Ratings said in a report in September 2023.

Given the government's focus on infrastructure growth and the consequent rising demand for urban housing, the cement sector is poised for strong growth in the coming years, the company said in a statement.

Demand for cement slowed in December due to elections in four states, flooding in some southern states and a ban on construction to curb air pollution. Although the prices dipped in the October-December quarter, lower fuel and raw material prices helped the cement maker to protect margins.

Declining costs

Analysts at Elara Securities said in a January 8 report that cement companies are benefitting from lower fuel prices and internal cost-saving measures. Power and fuel together account for almost 30 percent of UltraTech’s total costs.

During the second quarter of FY24, cement manufacturers saved Rs 80-100/tonne due to lower fuel costs, brokerage Emkay said in a note on November 2, adding that the upcoming quarters are likely to witness twin benefits—stable input prices, recent price hikes and benefits of operating leverage.

Capacity expansion

UltraTech, the flagship company of the Aditya Birla Group, said in November it would acquire the cement business of the BK Birla Group's Kesoram Industries in an all-stock deal. The acquisition will give UltraTech access to two integrated cement manufacturing units in Karnataka and Telangana with a combined capacity of 10.75 million tonnes per annum.

UltraTech has a consolidated capacity of 138.39 million tonnes per annum of grey cement, according to its website. India’s installed cement capacity is 541 million tonnes, according to the Cement Manufacturers’ Association.

Industry consolidation and cement price hikes undertaken during September and October provided better pricing discipline and strong operational profitability growth tailwinds for the company, brokerage ShareKhan wrote in a note last month.

"The company remains on track concerning its capacity expansion plans through organic and inorganic routes," the brokerage added.

UltraTech Cement shares have gained over 35 percent over the past year.