India’s largest cement maker, UltraTech Cement Ltd, posted its highest-ever annual profit in fiscal year 2026 (FY26), as strong demand helped cushion rising input costs linked to the West Asia war.
The company reported a consolidated net profit of ₹8,165.64 crore for the year—crossing the ₹8,000 crore mark for the first time and rising 35.12% year-on-year (y-o-y)—according to exchange filings, even as fuel and power expenses rose 6% and freight costs, 10%.
The Mumbai-based company also announced a special dividend of ₹240 per share, while flagging caution on the evolving geopolitical situation heading into FY27.
Consolidated revenue rose 16.53% to ₹88,511.53 crore, surpassing a Bloomberg estimate of ₹88,410 crore based on 45 analysts. Earnings before interest, tax, depreciation and amortization (Ebitda) rose 36% to ₹17,020.23 crore in FY26.
Consolidated domestic sales volumes for the fiscal stood at 145 million tonnes, up 8.4% from FY25.
UltraTech also reported strong fourth-quarter performance despite rising costs, with consolidated net profit and revenue rising 20.17% and 11%, respectively, to ₹2,982.76 crore and ₹25,799.47 crore.
Facing headwinds
“It’s a real headwind on fuel cost, packing bags and freight, on certain import-dependent supply chains or near-term sentiment in some demand segments,” chief financial officer Atul Daga said in a post-earnings interaction with analysts, adding that petrol and diesel prices could rise further in line with global crude trends.
For instance, incremental cost on cement bags was ₹90 crore, Daga said. Mint earlier reported that the West Asia war, which began on 28 February, affected the availability of polypropylene, a key raw material used to manufacture cement packaging bags, commonly referred to as bori.
According to Daga, the cement maker is taking several measures to mitigate the impact of the West Asia conflict—including diversifying sources of procurement, identifying newer opportunities, and inking long-term contracts for fuel.
“In packaging as well, we work with nearly 150 suppliers across the country and, naturally, suppliers tend to prioritize customers who offer higher volumes,” Daga said.
“The company reported strong earnings on the back of strict cost discipline and high volumes,” said Manish Valecha, co-head of research and lead cement analyst at Anand Rathi Securities, adding that there may be price hikes in May.
“Amid rising cost environment—higher bag prices and petcoke prices—Ultratech, through its efficient cost management (long term tie-ups, different sources, etc) along with price hikes, would be able to mitigate the same,” he said.
Demand intact
Despite the conflict-related headwinds in Q4, the company’s consolidated sales volumes stood at 42.41 million tonnes in the quarter, up 9.3% y-o-y.
Capacity utilisation surged to 89%, driven by robust demand across housing, infrastructure, and commercial construction segments, the company said in a statement.
Daga sees the demand momentum continuing. “Government capex is flowing. Infrastructure execution continues. Housing demand is robust,” he said.
The cement maker expects double-digit growth in volumes in the current fiscal and will invest ₹10,000 crore in capital expenditure every year for the next 4-5 years.
“We will also see higher contributions from India Cements and Kesoram Cement in FY27, which will also help them fund capex through internal accruals apart from their own cashflows,” Valecha said.
Expansion spree
Even as near-term costs remain volatile, UltraTech is continuing with its aggressive expansion plans.
The company enters FY27 with 200 million tonnes per annum (mtpa) installed capacity mark in India, chairman Kumar Mangalam Birla announced on 17 April at an event in Mumbai. Its capacity in the previous fiscal year was 183.4 mtpa.
As per its investor presentation, UltraTech plans to add 7.2 million tonnes capacity this fiscal, and 29.8 million tonnes in FY28. UltraTech is now the world’s largest cement producer outside China.
In contrast, India’s second-biggest cement maker—Adani Group’s Ambuja Cements—has indicated it will prioritize profitability and capacity utilization over rapid expansion, and may defer its target of reaching 155 mtpa capacity by FY28, Mint reported earlier. It currently has a capacity of about 109 mtpa.
