UltraTech Cement Q3 Profit Jumps 27% to ₹1,729 Crore

Introduction

UltraTech Cement Ltd, India's largest cement manufacturer, announced a robust performance for the third quarter of fiscal year 2026. The company reported a 27% year-on-year increase in its consolidated net profit, which stood at ₹1,729.4 crore for the quarter ending December 31, 2025. This growth was achieved despite a one-time exceptional expense and was primarily driven by strong sales volumes and enhanced operational efficiency. The performance surpassed market expectations, signaling healthy demand in the construction sector.

Detailed Financial Performance

The Aditya Birla Group flagship company's revenue from operations for Q3 FY26 climbed 23% to ₹21,830 crore, up from ₹17,778.8 crore in the corresponding period of the previous year. This figure also exceeded analyst forecasts. The company's earnings before interest, tax, depreciation, and amortization (EBITDA) saw a significant 35.2% rise to ₹3,915 crore. Consequently, the EBITDA margin improved to 17.94% from 16.28% a year ago, reflecting better cost management and operating leverage. The reported profit figures include a one-time exceptional expense of ₹88 crore related to obligations under the new Labour Code, which came into effect in November 2025.

Operational Highlights and Volume Growth

On the operational front, UltraTech's consolidated cement sales volumes grew by 15% year-on-year, reaching 33.85 million metric tons. This volume growth was a key contributor to the strong financial results. The company's capacity utilisation rate improved to 77% during the quarter, a notable increase from 72% in the same period last year. This indicates a healthy demand environment and efficient use of its expanding production assets. The domestic grey cement market, excluding the volumes from recently acquired entities like India Cements and Kesoram, showed an impressive growth of 29.4%.

Key Performance Metrics Q3 FY26

Capacity Expansion and Future Outlook

UltraTech continued its aggressive capacity expansion strategy during the quarter. The company commissioned 1.8 million tonnes per annum (mtpa) of new cement capacity, including 0.6 mtpa at its Dhule grinding unit in Maharashtra and 1.2 mtpa at its Nathdwara integrated unit in Rajasthan. With these additions, UltraTech's domestic grey cement capacity now stands at 188.66 mtpa. Including its overseas operations, the company's total global capacity has reached 194.06 mtpa. Looking ahead, UltraTech is pursuing its next phase of expansion, which aims to add another 22.8 mtpa, bringing its total capacity to 240.76 mtpa.

Strategic Initiatives and Diversification

Beyond its core cement business, UltraTech is diversifying into new areas. The company confirmed that its foray into the Cables and Wires business is progressing as planned. Critical orders have been placed, civil work is underway, and the project team is in place. The company is confident of launching this new venture by the third quarter of fiscal year 2027. This move is part of a broader strategy to explore adjacent markets and create new revenue streams.

Sustainability and Debt Management

In line with its sustainability goals, UltraTech added 14 MW of Waste Heat Recovery System (WHRS) capacity, taking its total WHRS capacity to 383 MW. Green power now constitutes 42.1% of the company's total power mix, underscoring its commitment to reducing its carbon footprint. Financially, the company has maintained a strong balance sheet. During the quarter, it invested ₹2,357 crore in ongoing capital expenditure while improving its net debt-to-EBITDA ratio to 1.08x, reflecting robust operating cash flows.

Impact of Acquisitions

The company noted that its financial results for the quarter are not directly comparable with the previous year. This is due to the recent acquisitions of India Cements Ltd (ICL) and other entities, as well as the merger of Kesoram Industries' cement business. These strategic moves have expanded UltraTech's market presence, particularly in the southern region. India Cements, now under UltraTech's management, reported a 25% year-on-year growth in sales volumes to 2.59 million tonnes and is on a path to improved profitability.

Conclusion

UltraTech Cement's third-quarter results for FY26 demonstrate strong execution and a favorable market environment. The company successfully leveraged increased demand to drive volume growth, which, combined with operational efficiencies, led to improved profitability and margins. With a clear roadmap for capacity expansion and strategic diversification into new businesses, UltraTech is well-positioned to strengthen its leadership in the Indian construction materials sector and continue its growth trajectory.