This article first appeared on GuruFocus .
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Net Debt to EBITDA Ratio:1.08x, with a target to reach 0.8-0.9x by the end of the fiscal year.
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Brand Conversion at Kesoram:Reached 69% in December '25.
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Brand Conversion at India Cements:Crossed 58% at the end of December '25.
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CapEx at Kesoram:INR263 crore spent out of a commitment of INR382 crore.
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CapEx at India Cements:INR144 crore spent out of a commitment of INR601 crore.
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Lead Distance:Reduced to 363 kilometers.
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Clinker Conversion Factor:Improved to 1.49.
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Warning! GuruFocus has detected 5 Warning Signs with BOM:532538.
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Release Date: January 24, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
Positive Points
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UltraTech Cement Ltd ( BOM:532538 ) reported strong demand driven by government infrastructure projects across various regions in India, indicating a robust pipeline for cement consumption.
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The company is strategically positioned to capture growth opportunities with its pan-India network and deepening retail footprint, enhancing its ability to meet rising demand.
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UltraTech Cement Ltd ( BOM:532538 ) is funding its growth through internal accruals, maintaining a prudent balance sheet and a healthy leverage profile, with a net debt to EBITDA ratio expected to improve further.
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Integration of recent acquisitions, such as Kesoram and India Cements, is progressing well, with significant brand conversion and cost improvement initiatives underway.
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The company is advancing its next phase of capacity expansion with orders placed and work commenced, ensuring timely execution and capacity additions in the coming years.
Negative Points
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Cement prices have remained subdued post-GST change, with some softening observed in the last quarter, impacting profitability.
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There are cost increases in petcoke and coal, along with potential impacts from new labor codes and rupee depreciation, which could pressure margins.
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The company faces challenges in rural demand, which, while not depressed, requires close monitoring to ensure sustained growth.
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UltraTech Cement Ltd ( BOM:532538 ) is navigating complex legal issues related to non-core asset sales, particularly concerning attached properties and financial securities.
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The company is experiencing fluctuations in freight costs and clinker conversion ratios, which require ongoing efficiency improvements to maintain cost control.
Q & A Highlights
Q: With the significant industry capacity addition expected this year, how do you foresee the industry's stance on pricing in such a high expansion scenario? A: Atul Daga, CFO: The demand footprint and new initiatives suggest that cement will be easily absorbed. If demand remains strong, we will not see any problem in prices.
Q: Regarding India Cements, the EBITDA per tonne was about INR400 in Q3. You previously guided for INR1,000 by Q4 '27. Will this improvement be primarily through cost or pricing? A: Atul Daga, CFO: The brand conversion has already taken place, and prices are rising in southern markets. The CapEx program for efficiency improvement has begun, and all factors, including prices, efficiency, and capacity utilization, will contribute to the improvement.
Q: Can you provide guidance on capacity additions for Q4 and the next two years? A: Atul Daga, CFO: Approximately 8 to 9 million tonnes will be added this quarter, with 12 million tonnes in fiscal '27 and the remaining in '28.
Q: How has rural demand recovered in the third quarter, and what are your expectations for the future? A: Atul Daga, CFO: Rural demand is buoyant, as indicated by strong trade ratios. We expect solid demand in Q4 as well.
Q: With the infra demand coming back, will cement prices move up, and how will this affect realizations? A: Atul Daga, CFO: Non-trade prices will also harden with infra demand, so there should be no problem. The gap between non-trade and trade prices had narrowed, but demand will support pricing.
Q: What are your expectations for Southern India's cement pricing stability given recent acquisitions? A: Atul Daga, CFO: More demand is needed for stability. South India is witnessing large institutional demand, and I believe '26 will be a fabulous year for pricing stability.
Q: Can you provide details on the sourcing of fly ash and slag, and are there any limiting factors for improving the clinker factor? A: Atul Daga, CFO: There is enough new supply coming up, and we have a mix of long-term, short-term, domestic, and import sourcing. There are no limiting factors for improving the clinker factor.
Q: What is the impact of increasing input costs in the fourth quarter? A: Atul Daga, CFO: It's difficult to predict, but we are managing our middle line well. Fuel costs have remained stable, and raw material costs are already matured.
For the complete transcript of the earnings call, please refer to the full earnings call transcript .
