UltraTech Cement’s Q2 FY26 earnings call highlights strong sales of over 31 million tons despite heavy rainfall. UltraTech brand grew 13.2% Y-o-Y. The company’s focus includes converting acquired brands to UltraTech and expanding capacity. The next growth phase targets the North and West regions with an incremental capacity of 22.8 million tons, aiming for 240-245 million tons by fiscal ’29.
Sales and Demand
In Q2 FY26, UltraTech Cement sold over 31 million tons of cement. Sales volume growth, excluding ICL and Kesoram in the base, grew by 22.3%. Excluding India Cements, sales grew by 9.6%. Including both ICL and Kesoram, growth was approximately 6.8%. UltraTech as a brand grew 13.2% Y-o-Y, and rural markets also delivered 13% growth.
Acquisitions and Brand Conversion
India Cements has already converted 31% of its brand to UltraTech, and Kesoram has converted 55% by the end of the quarter. The complete brand transition for these acquired assets is expected by June ’26.
Costs and Efficiency
Maintenance costs impacted earnings by roughly INR 100 per ton. Advertising costs were INR 50 crores higher, impacting earnings by about INR 15 per ton. Staff costs were also slightly higher, increasing costs by INR 94 crores quarter-on-quarter, or approximately INR 25 per ton. Maintenance cost reduction of about INR 100 per ton is expected in Q3.
Expansion Plans and Capex
UltraTech aims to exit the financial year with 200 million tons of capacity. The next growth phase will add 22.8 million tons of incremental capacity, primarily through brownfield expansions. 18 million tons are focused on the Northern markets, and 4.8 million tons are for the Western markets. The company is aiming to reach 148 million tons of clinker capacity, with a clinker conversion factor close to 1.6x.
Financial Performance of Acquired Assets
Existing operating assets delivered an EBITDA per metric ton of INR 966. India Cements reported INR 386 per metric ton, and Kesoram assets reported INR 755 this quarter. India Cements has initiated a capex program of INR 1,592 crores for debottlenecking, renewable energy, and efficiency improvements. Capacity will be expanded at Chennai and Rajasthan plants by 2.4 million tons at a cost of INR 422 crores.
Green Energy and Retail
UltraTech’s green power mix has reached 42% and is targeted to reach 65% by the end of the current growth phase. Retail footprint includes 5,000 stores across the country, accounting for 21% of total sales this quarter. RMC (Ready Mix Concrete) has crossed 400 plants and accounts for approximately 4% of cement volumes.
Source: BSE
