India Ratings and Research (Ind-Ra) has affirmed UltraTech Cement Limited’s (UCL) Issuer Rating at ‘IND AAA/Stable’ and maintained the rating on bank loan facilities at ‘IND AAA/Stable/IND A1+’. The rating agency withdrew its rating on outstanding Commercial Papers (CPs) after they were fully redeemed. The affirmation reflects UCL’s continued leadership in the Indian cement industry, strong pan-India diversification, and robust financial profile, which is expected to sustain despite planned capital expenditure.
Rating Affirmation and Key Actions
India Ratings and Research (Ind-Ra) has affirmed UltraTech Cement Limited’s (UCL) Issuer Rating as ‘IND AAA/Stable’. The rating on the bank loan facilities was also affirmed at ‘IND AAA/Stable/IND A1+’. Concurrently, the agency confirmed the withdrawal of the rating assigned to the Commercial Papers (CP) due to their full redemption by the issuer.
Business Profile Strengths
The rating reflects UCL’s continued strong business profile, anchored by its leadership position in the Indian cement industry. At end-December 2025, UCL held a domestic grey cement capacity share of around 27%, with total capacity reaching 194.1 million tonnes per annum (mnt). The company maintains a strong distribution network of over 145,000 channel partners.
UCL benefits from strong geographical diversification, being one of three groups with a pan-India manufacturing presence. Recent acquisitions, including The India Cements Ltd (ICL) and Kesoram Industries Ltd (KIL), are enhancing this position, with UCL planning to reach 240.8mnt capacity by FY28.
Operational Performance and Profitability
UCL has consistently outperformed the industry, growing at 13%-14% yoy over FY23-FY25. Consolidated revenues reached around INR627 billion in 9MFY26, up 19% yoy. The company is driving profitability through cost efficiencies, increasing the share of green power to 41% in 9MFY26, with a goal to reach 85% by FY30. Consolidated EBITDA/mt recovered to INR1,042/mt in 9MFY26.
Acquisition Integration Success
Ind-Ra noted the successful turnaround of acquired assets. Post-acquisition, ICL generated positive EBITDA over 1Q-3Q, compared to preceding losses. Management reports fast integration, with 69% of KIL’s sales and 58% of ICL’s sales moved to the Ultratech brand in 3QFY26.
Financial Profile and Capex
Despite recent debt increases due to expansions and acquisitions, the credit profile remains strong. Consolidated net leverage stood at a comfortable 1.1x at end-December 2025 (compared to 1.4x at FYE25). EBITDA interest coverage was strong at 8.2x in 9MFY26.
UCL plans further capex of INR100 billion–110 billion each in FY26 and FY27 for expansions, including an INR18 billion investment in the wires and cables business over two years, commencing operations in December 2026.
Liquidity and Weaknesses
Liquidity is assessed as Superior, with INR51.1 billion in cash and equivalents at end-December 2025. UCL has strong access to capital markets and banking systems.
The primary weaknesses cited are susceptibility to volatility in input prices (coal, diesel) and inherent industry cyclicality in cement demand and supply.
Key Financial Indicators (Consolidated)
| Particulars (INR billion) | FY25 | FY24 |
|---|---|---|
| Revenue | 759.6 | 709.1 |
| Operating EBITDA | 125.6 | 129.7 |
| Net leverage (net debt/EBITDA) (x) | 1.4 | 0.2 |
Source: BSE
