UltraTech Cement: higher cement prices and easing fuel costs could support the stock

what happened

According to TradingView, UltraTech Cement, the largest cement producer in India, is entering the stronger second half of FY27 as demand and prices improve. Following October price increases of Rs 10-15 per bag, prices have mostly held across markets, and the all-India average rose about 3% month on month in October, or 9% year on year.

In the second quarter, the company grew consolidated cement volumes 13% year on year to 38.2 million tonnes. Revenue climbed 18.8% to Rs 23,295 crore and net profit rose 21.3% to Rs 1,501 crore. EBITDA per tonne gained 7% on the year to Rs 974 but fell 20% from the previous quarter because fuel became more expensive. The share of pet-coke in its fuel mix dropped to roughly 25% from 45% a year earlier.

Brent's slide to around $92 a barrel from an October peak of about $117 could ease costs, since pet-coke prices typically trail crude. The company targets double-digit volume growth in FY27, versus an expected industry rate of 6-8%, and plans to lift capacity to about 240 MTPA by March 2028.

why it matters

Cement is energy-intensive, so fuel prices feed straight into producers' margins. Cheaper crude and coal would matter most for companies like UltraTech, while the durability of higher prices will depend on how construction activity holds up.

market impact

UltraTech shares and Indian cement sector: cheaper fuel could support margins

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