Following the cement maker's Q4 reports, UltraTech Cement's shares increased by more than 2% in early trading on Tuesday. Shares of UltraTech Cement increased by 2.38% to Rs 10,200 from the previous BSE closing of Rs 9962.25. In comparison to the 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, UltraTech Cement stock is now trading higher. The share has decreased by 4.15% since the start of the year, but it has gained 32% in a single year. The company's market value increased to Rs 2.91 lakh crore on the BSE.
A total of Rs 3.79 crore worth of shares of the company were traded. On December 12, 2023, the cement stock reached a 52-week high of Rs 10,522.65 and a 52-week low of Rs 7436.75 on the BSE.
Following Q4 results, Motilal Oswal kept its optimistic outlook and set a price objective of Rs 11,500.
"Given the company's: a) leading position in the sector, b) strong development ambitions without straining the balance sheet, and c) structural cost optimization efforts, we mainly retain our estimates and reiterate our BUY recommendation on the shares. In order to reach our target price of Rs 11,500, we value UltraTech Cement at 18x FY26E EV/EBITDA, according to the brokerage," as per Motilal Oswal.
In two to three years, Nuvama anticipates savings of Rs 200–300 per tonne in operational costs.
"UltraTech Cement forecasts its capacity (ex 10.75MT Kesoram capacity) to attain 157MT by FY25E and 183.5MT by FY27E. Its domestic grey cement capacity was 140.8MTPA at the end of FY24. By the end of FY25, it also hopes to be net-cash (ex-Kesoram). After accounting for UTCL's robust cash flows and capital plans, we are increasing the EV/EBITDA ratio to 16x (from 15.5x). Revisioned price objective of Rs 10,024 (Rs 9,878) should be maintained, the brokerage added.
UltraTech Cement said that its consolidated net profit increased by 35.23% to Rs. 2,258.58 crore in Q4. Additionally, the board of the firm suggested a final dividend of Rs 70 per share. The business added 7.8 MTPA of cement production to its total capacity in India, bringing its total capacity for grey cement to 140.8 MTPA.
Compared to Rs 18,784 crore in the same quarter of the previous fiscal year, total income increased to Rs 20,555 crore in Q4. Compared to Rs 3444 crore in the Q4 of FY23, EBITDA increased to Rs 4250 crore in Q4.
"First-cut Q4 results exceeded Prabhudas Lilladher's projections; robust operating performance supported by volumes." The enterprise valuation of the stock is 17.2x/14.1x FY25E/FY26E EBITDA at current market value. Remain Buy, said Tushar Chaudhuri, Research Analyst at Prabhudas Lilladher's Institutional Equities.
