UltraTech Cement stock gains on Q4 earnings, here are fresh price targets

Shares of UltraTech Cement rose over 2% in early deals on Tuesday post the cement maker’s Q4 earnings. UltraTech Cement shares gained 2.38% to Rs 10,200 against the previous close of Rs 9962.25 on BSE. UltraTech Cement stock is trading higher than the 5-day, 20-day, 50-day, 100-day and 200-day moving averages. The share has gained 32 per cent in one year but fallen 4.15% since the beginning of this year. Market cap of the firm rose to Rs 2.91 lakh crore on BSE.

3774 shares of the firm changed hands amounting to a turnover of Rs 3.79 crore. The cement stock hit 52-week high of Rs 10,522.65 on December 12, 2023 and a 52 week low of Rs 7436.75 on BSE.

Motilal Oswal has maintained its bullish stance post Q4 earnings and assigned a price target of Rs 11,500.

“We largely maintain our estimates and reiterate our BUY rating on the stock, given its: a) leadership position in the industry, b) robust expansion plans without leveraging the balance sheet, and c) structural cost improvement measures. We value UltraTech Cement at 18x FY26E EV/EBITDA to arrive at our target price of Rs 11,500,” said the brokerage.

Nuvama expects operating cost savings of Rs 200–300 per tonne in two–three years. “UltraTech Cement ended FY24 with domestic grey cement capacity of 140.8MTPA, and expects its capacity (ex 10.75MT Kesoram capacity) to touch 157MT by FY25E and 183.5MT by FY27E. It also expects to be net-cash (ex-Kesoram) by end-FY25. Factoring in UTCL’s healthy capex plans and cash flows, we are edging up the EV/EBITDA to 16x (from 15.5x). Maintain ‘HOLD’ with a revised price target of Rs 10,024 (Rs 9,878),” said the brokerage.

UltraTech Cement reported a 35.23% rise in consolidated net profit at Rs Rs 2,258.58 crore in Q4. The company's board also recommended a final dividend of Rs 70 per share. The firm commissioned cement capacity of 7.8 MTPA, taking total grey cement capacity of the company to 140.8 MTPA in India.

Total income climbed to Rs 20,555 crore in Q4 against Rs 18,784 crore in the corresponding quarter of the previous fiscal. EBITDA climbed to Rs 4250 crore in Q4 against Rs 3444 crore in the Q4 OF FY23.

"Q4 Results First Cut, beat Prabhudas Lilladher estimates; strong operating performance aided by volumes. The stock trades at an enterprise valuation of 17.2x/14.1x FY25E/FY26E EBITDA. Maintain Buy," said Tushar Chaudhuri, Research Analyst, Institutional Equities, Prabhudas Lilladher.