UltraTech Cement Q4 Review - Second Covid-19 Wave A Blip; Long-Term Thesis Intact: ICICI Securities
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ICICI Securities Report
Key takeaways from UltraTech Cement Ltd.’s management concall include:
1. Company to remain focused on organic as well as inorganic expansion in domestic market, given operating cash flow generation of more than Rs 100 billion per annum;
2. expect strong demand growth in the medium-term; recent slowdown owing to second Covid-19 wave likely to be temporary;
3. expansion of 19.5 million tonne capacity on track to get commissioned by March 2023-end;
4. royalty cost savings of Rs 2 billion per annum owing to recent Mumbai Metropolitan Region Development Authority amendments; fuel costs escalations to stabilise by Q3 FY22; and
5. expects return ratios to improve by at least 300 basis points in the medium-term.
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