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Choice Equity Broking's report on Ultratech Cement

We maintain our BUY rating but increase our TP to INR15,210 as we 1) Increase Volume / EBITDA per ton and EBITDA assumptions higher (Exhibit 2) to factor in volumes from Kesoram / India Cement acquisition integrations and subsequent turnaround 2) Factor in benefit from cost optimisation program 3) Factor in improving Cement pricing situation across the country and 4) Now incorporate a robust EV to CE (Enterprise Value to Capital Employed) based valuation frame work (Exhibit 3) which allows us a rational basis to assign a valuation multiple that captures improving fundamentals (ROCE expansion by 720bps over FY25-28E).

Outlook

We arrive at a 1-year forward TP of INR 15,210/share for UTCEM. We now value UTCEM on our EV/CE framework – we assign an EV/CE multiple of 3.80x/3.80x for FY27E/28E, which we believe is conservative given the increase of ROCE from 8.4% in FY25 to ~15.6% in FY28E under reasonable operational assumptions.

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Ultratech Cement - 30042025 - choice

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