Result Analysis: Ultratech Cement Ltd. Result Update Q2FY22


Particulars (In ₹. Cr) Q2FY22 Q1FY21 Q2FY21 QoQ % YoY%
Revenue From Operation 12016 11830 10387 1.57% 15.68%
Other Income 140 204 135 -31.37% 3.70%
Total Income 12156 12034 10522 1.01% 15.53%
Cost Of material Consumed 1731 1550 1350 11.68% 28.22%
Other Expenses 8478 7958 7374 6.53% 14.97%
Material Cost as percentage of revenue 14.41% 13.10% 13.00% 9.95% 10.84%
EBITDA 2855 3,511 2833 -18.68% 0.78%
EBITDA Margin 23.49% 29.18% 26.92% -19.50% -12.77%
Profit After Tax 1,313 1,702 1,167 -22.86% 12.51%
PATM (%) 10.80% 14.14% 11.09% -23.63% -2.61%
Basic EPS (in Rs. ) 45.54 59.02 40.44 -22.84% 12.61%


Segment Revenue Q2FY22 Q1FY21 QoQ %
Grey Cement 9,884 10,185 -2.96%
RMC 614 509 20.63%
White Cement 505 362 39.50%
Grey Cement (overseas) 501 445 12.58%

Result Highlight:

  • Revenue from operation rose by57% QoQ and 15.68% YoY to ₹ 12016 crore. Other income decline 31.37 % QoQ to ₹ 140 Crore.

  • Material cost formed 14.41%of total sale, cost of material rises 28.22% YoY.

  • EBITDA came in at ₹ 2855 compared to ₹ 2833 Y-o-Y and EBITDA margin at 23.49%

  • Net profit rose 12.51% YoY to ₹1313 crore for the September quarter compared with ₹ 1167 crore in the same quarter last

  • Premium Product volume increase 14% YoY, grey cement volume increase by 8% YoY.

  • Logistic Cost formed 31% of the total cost and increased 7% YoY to ₹1219 per tonne.

  • Energy cost increased by 17% to ₹ 1099 per tonne, this rise is due to steep rise in coal and petcock prices.

  • Net debt of the company has fallen to ₹ 6336 crore and net debt / EBITDA to 0.47. Net Debt : EBITDA reduced to 0.47x from the peak of

  • 55x after UNCL and Century acquisitions during FY19

  • ROCE of the company improved from 15.3% to 17.3%.

  • ROE improved to 16.5% from 15.6%.

Management commentary: 

  • Cement prices are back to pre-monsoon levels; margins are still affected due to the increased operational costs. More price increases will happen as demand is robust..

  • All 4000-5000 crores of Capex in FY21 will be funded by internal accruals while they are going to pay off more debt.

  • Ultratech is there concall said they are market leaders and will always command market premium.

  • West, South and North are areas which have done well, while in East demand of cement has fallen as housing as seen a degrowth due to rains and Covid.

  • Coal and Petcock prices nearly doubled in Q2FY22resulting in energy cost rise by 17%.The resulting impact on the company’s operations were partly offset by reduction in power consumption and continuing focus on operational efficiencies. The company expect to commence mining operations at its Bicharpur coal block situated in Madhya Pradesh, during Q3FY22 which will help in reducing the dependence on coal purchases.

  • Management is quite confident of weathering the storm of increase in price of raw material with its sustainable efficienc

  • y improvement programs, accompanied by increase in selling price to absorb the increase in costs.

  • Management said fuel cost is going to increase by $ 10 in third quarter and this is going to be offset by price increase and management feels they are going to maintain there last year EBITDA margin.

  • Management feels they are going to have 6-8% volume growth in next quarter as demand is very strong in housing sector. They have already increase price by ₹10-15 per bag in different parts and which has not impacted demand and expect further rise in prices in coming days.


Ultratech cement reported a muted set of result which was below the street expectation revenue came in at ₹ 12016 compared   to ₹ 10387 last year and PAT came in at ₹1313 compared to ₹1166 crore last year. Ultratech’s 2QFY22 EBITDA at ₹27.15bn (+1% YoY) was near estimates (INR28.1bn) as higher than expected cost   inflation/overhead costs offset the benefit of better realisation and higher Other operating Income. For India operations, EBITDA/T (India Ops) was at ₹1320 vs street expectation of ₹ 1350 down INR270/T QoQ, lower INR60/T YoY. In this quarter, volumes remained flat QoQ, up 7% YoY; Pricing fell 2-3% QoQ. During the call, management indicated of improving demand with receding monsoons; ultratech has taken INR10-15/bag price hikes effective early Oct and management feels rising costs would be compensated by increase in prices over coming days; Domestic Coal (17% of fuel mix) availability is impacted and company will switch to International Coal/Petcock for fuel; Cost are expected to remain high amid soaring fuel prices – could see a INR200/t QoQ cost impact in 3Q and higher in 4QFY22/1QFY23.  Targeted 19.5MMT expansion is on track and is expected to be completed by FY23 end taking total capacity to 136.25MMT capacity.We expect Cement demand to remain strong, led by the government’s thrust on Infrastructure development and recent improvement in housing demand. Ultratech Cement is in a strong position to gain market share, led by its strong distribution network A strong pipeline of expansion projects and scope for improvement in utilization of existing capacities offers strong growth visibility but cost inflation is going to have a negative impact on margin as coal and fuel pricing are still rising in 3Q and 4Q.At the CMP of ₹7489, Ultratech is trading at PE multiple of 37x. Valuing the company at 34x FY23E EPS, we recommend Hold on Ultratech at CMP of for the Target Price of ₹ 7820.

Disclosure in pursuance of Section 19 of SEBI (RA) Regulation 2014

Elite Wealth Limited does/does not do business with companies covered in its research reports. Investors should be aware that the Elite Wealth Limited may/may not have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only information in making their investment decision and must exercise their own judgment before making any investment decision.
For analyst certification and other important disclosures, see the Disclosure Appendix, or go to Analysts employed by Elite Wealth Limited are registered/qualified as research analysts with SEBI in India.( SEBI Registration No.: INH100002300)
Disclosure Appendix
Analyst Certification (For Reports)
Israil Khan, Elite Wealth Limited,
The analyst(s) certify that all of the views expressed in this report accurately reflect my/our personal views about the subject company or companies and its or their securities. I/We also certify that no part of my compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in this report. Unless otherwise stated, the individuals listed on the cover page of this report are analysts in Elite Wealth Limited.
As to each individual report referenced herein, the primary research analyst(s) named within the report individually certify, with respect to each security or issuer that the analyst covered in the report, that:
(1) all of the views expressed in the report accurately reflect his or her personal views about any and all of the subject securities or issuers; and
(2) no part of any of the research analyst’s compensation was, is, or will be directly or indirectly related to the specific recommendations or views expressed in the report.
For individual analyst certifications, please refer to the disclosure section at the end of the attached individual notes.
Research Excerpts
This note may include excerpts from previously published research. For access to the full reports, including analyst certification and important disclosures, investment thesis, valuation methodology, and risks to rating and price targets, please visit
Company-Specific Disclosures
Important disclosures, including price charts, are available and all Elite Wealth Limited covered companies by visiting, or emailing with your request. Elite Wealth Limited may screen companies based on Strategy, Technical, and Quantitative Research. For important disclosures for these companies, please e-mail
Options related research:
If the information contained herein regards options related research, such information is available only to persons who have received the proper option risk disclosure documents. For a copy of the risk disclosure documents, please contact your Broker’s Representative or visit the OCC’s website at
Other Disclosures
All research reports made available to clients are simultaneously available on our client websites. Not all research content is redistributed, e-mailed or made available to third-party aggregators. For all research reports available on a particular stock, please contact your respective broker’s sales person.
Ownership and material conflicts of interest Disclosure
Elite Wealth Limited policy prohibits its analysts, professionals reporting to analysts from owning securities of any company in the analyst’s area of coverage. Analyst compensation: Analysts are salary based permanent employees of Elite Wealth Limited. Analyst as officer or director: Elite Wealth Limited policy prohibits its analysts, persons reporting to analysts from serving as an officer, director, board member or employee of any company in the analyst’s area of coverage.
Country Specific Disclosures
India – For private circulation only, not for sale.
Legal Entities Disclosures
Mr. Ravinder Parkash Seth is the Managing Director of Elite Wealth Ltd (EWL, henceforth), having its registered office at Casa Picasso, Golf Course Extension, Near Rajesh Pilot Chowk, Radha Swami, Sector-61, Gurgaon-122001 Haryana, is a SEBI registered Research Analyst and is regulated by Securities and Exchange Board of India. Telephone:011-43035555, Facsimile: 011-22795783 and Website:
EWL discloses all material information about itself including its business activity, disciplinary history, the terms and conditions on which it offers research report, details of associates and such other information as is necessary to take an investment decision, including the following:
1. Reports
a) EWL or his associate or his relative has no financial interest in the subject company and the nature of such financial interest;
(b) EWL or its associates or relatives, have no actual/beneficial ownership of one per cent. or more in the securities of the subject company, at the end of the month immediately preceding the date of publication of the research report or date of the public appearance;
(c) EWL or its associate or his relative, has no other material conflict of interest at the time of publication of the research report or at the time of public appearance;
2. Compensation
(a) EWL or its associates have not received any compensation from the subject company in the past twelve months;
(b) EWL or its associates have not managed or co-managed public offering of securities for the subject company in the past twelve months;
(c) EWL or its associates have not received any compensation for investment banking or merchant banking or brokerage services from the subject company in the past twelve months;
(d) EWL or its associates have not received any compensation for products or services other than investment banking or merchant banking or brokerage services from the subject company in the past twelve months;
(e) EWL or its associates have not received any compensation or other benefits from the Subject Company or third party in connection with the research report.
3 In respect of Public Appearances
(a) EWL or its associates have not received any compensation from the subject company in the past twelve months;
(b) The subject company is not now or never a client during twelve months preceding the date of distribution of the research report and the types of services provided by EWL