UltraTech Cement (ULTRACEMCO) Q2 24/25 earnings summary

Executive summary

• Q2 FY25 saw a pre-election and monsoon-driven slowdown, resulting in 68% capacity utilization and 3% domestic volume growth, with consolidated net sales at ₹15,308 crore and PAT at ₹820 crore, both down year-over-year.

• EBITDA declined 18% year-over-year to ₹2,718 crore, and PAT fell 36% year-over-year to ₹1,281 crore.

• RAK White became a subsidiary in July, with results consolidated.

• Urban housing and infrastructure projects are gaining momentum, with several large government projects announced.

• Rural demand is expected to improve due to strong monsoons and higher agricultural production.

Financial highlights

• Petcoke usage increased to 54% in the fuel mix, reducing fuel cost per Gcal by 8% quarter-over-quarter to INR 1.84.

• Cement prices improved from INR 347 in August to INR 354 in October, with Q2 average at INR 348.

• Employee costs rose sharply due to annual increments and a one-time bonus, with the underlying increase at 9-10%.

• Other expenses were elevated due to maintenance shutdown costs this quarter.

• Energy costs declined 14% YoY, while raw material costs increased 1%.

Outlook and guidance

• Ongoing capacity expansion is on track, aiming to surpass 200 MTPA by FY27 with recent and pending acquisitions.

• Expecting double-digit volume growth in H2, with profitability improvement driven by price recovery and normalization of seasonal costs.

• Industry capacity additions projected at 30 million tons annually for this and next fiscal, with UltraTech contributing about half.

• Rural, infra, and urban demand expected to drive H2 growth.

• Management expects sustainable volume growth of 7-8% in future years, driven by infrastructure and housing demand.