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CapitalAim
UltraTech Cement (Buy)
CMP: ₹4,347.5
Target: ₹5,028
UltraTech Cement is the largest manufacturer of cement in India and ranks among the world’s leading cement makers. UltraTech’s vision is to be ‘The Leader’ in building solutions.
The cement industry started witnessing pick-up in demand since FY2018, achieving double digit growth since the last two years, after a period of tepid growth. However, there continues to be relatively low increase in new capacity. Incremental capacity added during the year has been 12 mtpa against incremental demand of around 38 million tonnes, which resulted in improving industry capacity utilisation and will further help in improving the demand-supply balance.
For the quarter ended 31-03-2019 the company has reported consolidated sales of ₹10,905.15 crore up 16 per cent from the last quarter sales of ₹9,389.62 crore and up 15.75 per cent from last year same quarter sales of ₹9,420.76 crore. Company has reported net profit after tax of ₹1,032.79 crore in the latest quarter up by 162 per cent q-o-q.
According to recent financial performance, estimate and future demand growth, we recommend ‘buy’ for a target ₹5,028.
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