UltraTech Cement shares fall 5% from day's high post-Q2 results: Here's why

At 2:18 pm on October 19, UltraTech Cement shares were trading 2.3% lower at Rs 10,664 apiece as compared to day's high of Rs 11,219. Total expenses rose 17.8% during the quarter, as raw material costs jumped 24%. Operating EBITDA, or earnings before interest, taxes, depreciation and amortisation, rose by Rs 60 year-on-year to Rs 974 per ton. Analysts at Macquarie expect Indian cement companies to roll out further price hikes after the local festive season as construction activity picks up.

Ultratech's domestic grey cement sales volumes climbed 13.8% to 35.94 million metric tons, aided by a low base and a capex cycle pick-up. Its consolidated domestic grey cement capacity stood at 204.7 mtpa as on September-end. The cement major's consolidated revenue from operations rose 18.8% to Rs 23,295.1 crore during the July-September quarter, compared with approximately Rs 19,608.7 crore in the corresponding period last year.

UltraTech Cement reported a 17.3% year-on-year increase in profit before interest, depreciation and tax (PBIDT) to Rs 3,832 crore, compared with Rs 3,268 crore in the year-ago quarter. Consolidated net sales increased 18.9% to Rs 23,024 crore from Rs 19,371 crore a year earlier. The company reported strong volume growth during the quarter, notwithstanding challenges from a monsoon-affected period and the ongoing West Asia crisis.

UltraTech attributed the performance to disciplined execution, a wider market footprint, cost optimisation and a sharper focus on premium products. Capacity utilisation improved to 71% from 66% in the corresponding quarter last year, reflecting stronger volumes and improved utilisation of its manufacturing facilities.