UltraTech lines up Rs 10,000 cr capex for FY26 to bolster capacity
The Aditya Birla group firm recently acquired South-based India Cements and the cement business of Kesoram Industries, and added 26.3 MTPA of grey cement capacity to its portfolio. It has planned an organic capacity addition of 28.8 MTPA by FY27.
UltraTech, which crossed the Rs 75,000 crore revenue mark in FY25 and is now very close to 200 MTPA (million tonnes per annum) capacity, anticipate a reduction in "net debt to EBITDA ratio", helped by a higher volume growth and improving margins. "Although our net debt to EBITDA (pre-tax profit) ratio rose to 1.33x in March 2025, we anticipate higher volume growth and an improving EBITDA profile to reduce this rapidly," its Managing Director K C Jhanwar said while addressing the shareholders. Like other cement makers, UltraTech also faced a lowered sales realisation amidst tepid demand conditions last year, which marginally declined its EBITDA (earnings before interest, taxes, depreciation and amortisation) compared with FY24.
The cement demand has reached approximately 435 million tonnes in India, and with tailwinds such as continued government focus on infrastructure development, affordable housing, and urbanisation is expected to bolster the demand further, the company said. Moreover, the government in its Union Budget allocated Rs 11.21 lakh crore for the infrastructure sector, providing further tailwind to demand for cement. "While cement demand moderated to 4-5 per cent in FY 2024-25 owing to a temporary slowdown in government infrastructure spending and a prolonged monsoon, it is likely to rebound to 6-7 per cent in FY 2025-26," Jhanwar added. He further said UltraTech added 42.6 MTPA of consolidated grey cement capacity through organic and inorganic growth in FY25, taking total capacity to 188.8 MTPA. As of June 30, 2025, the company's consolidated capacity has reached 192.26 MTPA and is accelerating its journey towards the 200 MTPA capacity milestone, he added. On scaling up the capacity, Jhanwar said, besides acquisitions of India Cements and Kesoram Industries, the company has added 16.3 MTPA through organic expansions, which accounted for 55 per cent of India's total cement sector expansion in FY25, reinforcing its industry-leading position. On India Cements and Kesoram, he said the two entities have significantly strengthened our footprint in the attractive South India market. "We are unlocking further value through energy and efficiency initiatives. For instance, at the erstwhile Kesoram units, we are expanding green energy capacity by 107 MW to enhance operational efficiencies," he said. For India Cement, which achieved EBITDA break-even in the March 2025 quarter after efficiency improvements, UltraTech said "a capex plan is being made for investments over the next two years for improvement in all areas of operations to bring these assets at par with UltraTech standards".
UltraTech is facing competition from Adani group firm Ambuja Cements, which is also adding capacity through acquisitions and pacing up organic capacity addition at existing units. It has crossed 100 MTPA capacity in FY25 in a record time, mainly through acquisitions, and now aims to reach 118 MTPA by FY2026 and 140 MTPA by FY2028.
Adani Group, which jumped into the Cement sector in September 2022 after acquiring controlling stakes in Ambuja Cement from Swiss firm Holcim for cash proceeds of USD 6.4 billion (about Rs 51,000 crore), owns ACC Ltd. Later, it acquired small companies such as Hyderabad-based Penna Cement, Saurastra-based Sanghi Industries and Orient Cement from the CK Birla group.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Hindustan Times
5 minutes ago
- Hindustan Times
Monorail set for overhaul with 5-year private operations contract
MUMBAI: In a bid to revive Mumbai's struggling monorail system, the Maha Mumbai Metro Operation Corporation Ltd (MMMOCL)—a subsidiary of the Mumbai Metropolitan Region Development Authority (MMRDA)—plans to appoint a single private operator through a five-year contract to oversee its operations and maintenance. Mumbai, India. July 07, 2025: New colored Monorail racks have arrived at the Wadala Monorail Depot. The Maha Mumbai Metro Operation Corporation Ltd (MMMOCL) plans to introduce additional monorail services to help manage the heavy rush. Mumbai, India. July 07, 2025. (Photo by Raju Shinde/HT Photo) (Raju Shinde) The nearly 20-km long Chembur to Sant Gadge Maharaj Chowk (Jacob Circle) corridor has faced persistent technical glitches and service disruptions since its commercial launch on February 2, 2014. The system's troubles continued after MMRDA terminated its contract with the original operator, a consortium of Scomi Engineering and Larsen & Toubro, in December 2018. Since then, operations have been managed under annual contracts by different private players, leading to repeated coordination issues. 'Each time there's a breakdown or delay, the blame game begins between the operators and the maintenance team,' an MMMOCL official said, adding that a long-term single-operator model is aimed at fixing accountability. Bleeding infrastructure, limping services Despite the arrival of new rolling stock, the system continues to underperform. On July 28, only one train serviced the entire 19.54-km route, despite the availability of eight older trains and seven newly delivered rakes. An eighth new rake is expected later this month, while two more are due by November. The new trains, supplied by Hyderabad-based Medha Servo Drives, are yet to receive the necessary safety clearances to begin full operations. The ₹300 crore tender floated by MMMOCL includes both operations and maintenance of the entire system—including the Wadala depot and 17 stations. Notably, the new contract excludes any joint ventures, allowing only single bidders to qualify. Revival plan in motion Under its 2024 revival blueprint, MMMOCL plans to field 12 operational rakes daily—eight refurbished old trains and ten new rakes—while two will be kept on standby and four reserved for scheduled maintenance. Originally, Scomi Engineering was to supply 15 rakes, but only 10 were delivered before contractual disputes ended the collaboration. According to current plans, 142 services are scheduled each weekday, with each train running approximately 350 km daily between 5.48 am and 11 pm. However, these targets are not met at times due to inadequate rolling stock and frequent breakdowns.
Indian Express
5 minutes ago
- Indian Express
Six years since the abrogation of Article 370 in J&K, belied promises
Article 370 was seen as a development dampener. Its abrogation was expected to bring about economic transformation in Jammu and Kashmir. The promised bargain underlying the constitutional, governance and administrative downgrade was an era of unprecedented economic growth and prosperity. The development dividend that Kashmiris had been deprived of for the last seven decades and more would be shared with them, as in the rest of the country. Today, J&K completes six years as a Union Territory. This anniversary, like a forced pause, allows us to take stock of how J&K's economy has fared as a centrally administered unit. Have the promise of opening the floodgates of corporate investments and the promises of prosperity been delivered? Far from it. The macroeconomic performance of J&K post-2019 is disappointing. J&K's $30 billion economy has grown at a much slower pace post the abrogation. The growth in Gross State Domestic Product has declined both in nominal and in real terms. The fall is much sharper in real terms, placing J&K far below the national rate of growth. As a result, the contribution of J&K to the national GDP has declined to 0.77 per cent. The tertiary sector, which accounts for 60 per cent of the local economy, has borne the brunt of the slowdown with its rate of growth getting halved to 5.8 per cent in 2023-24 from 11 per cent in 2022-23. Income growth from hotels and restaurants declined from 38 per cent to 13 per cent. The growth in real per capita income has also been halved — from 6 per cent to less than 3 per cent. In 2011-12, J&K's per capita income was 84 per cent of the national average, but now it has declined to 76 per cent. The gap between the two is the highest ever in 2024. Besides the slowdown in income growth, unemployment has been volatile post-2019 with temporary spikes much higher than earlier peaks. The unemployment rate spiked to 23 per cent in March 2023 and remained at 17 per cent in 2024. In the 15-29 age bracket, the unemployment rate of more than 30 per cent is almost double the national average. J&K is now among the states with the highest unemployment rate. It is high despite an increase in the labour force participation rate as well as the worker population ratio — this reflects economic instability. The number of workers in industry reached a decadal low in 2022-23. Even the number of factories has been stagnant at the 2016-17 level. Underlying the slower growth and higher volatility, be it output or employment, is a drop in fixed capital. J&K's fixed capital, which peaked in 2016-17, had halved by 2022-23. This drop is quite unprecedented and has not been distorted by the separation of Ladakh. The UT's government recently stated that J&K has attracted investment proposals worth Rs 84,544 crore across 42 industrial sectors. In 2023, actual investments on the ground reached Rs 2,518 crore, with 266 industrial units registered in Jammu and 148 in Kashmir. Yet, the official statistics collated by the central statistical bodies, such as the Annual Survey of Industries, show a decline in the invested capital in J&K. Capital investments started gaining momentum in 2015-16 and peaked the next year. By 2022-23, this had declined in absolute terms. In 2022-23, less capital was invested in J&K compared to what it was five years earlier. It should be obvious that the capital intensity of the economy has declined. The decline in fixed and invested capital has been accompanied by a sharp rise in borrowings — a sure recipe for a fiscal crisis. Despite better revenue mobilisation, J&K's fiscal health has deteriorated significantly with higher debt and deficits compared to pre-2019. Internal debt has almost doubled in just five years. The total liabilities of the government have also surged, making them more than half of the GSDP. The total outstanding liabilities of the government are now almost 60 per cent of the GSDP. The all-India average of states is less than half of this figure. The fiscal deficit continues to hover around 6 per cent, way above the stipulated FRBM limits. All this is despite the government earning more and spending more. The state's own revenues have increased threefold in eight years. The tax-to-GDP ratio has increased sharply from 6.3 to 8.4 per cent, a consequence of implementing GST in July 2017. Yet, they are also borrowing much more. Without investment growth, the sharp improvement in the credit-deposit ratio can be problematic. A higher credit growth is likely to be financing consumption, which can lead to a debt trap. The impact of credit growth has also been dampened by the negligible share of J&K in national credit, which is not even 1 per cent. The share in deposits, which has been growing at a slow rate, is around 1 per cent, indicating a net resource outflow. This continued low level of credit is validated by the credit-to-GSDP, which is as low as 38 per cent in 2024, compared to, say, Maharashtra, where it is 99 per cent. The low level of credit adds to the shortage of capital in an already capital-scarce economy and will have a crippling effect on the growth potential of the economy. Inflation has normally been aligned with or slightly above the national averages. This is expected of an import-dependent sub-national economy like J&K. There was a sharp spike in 2019, after which the inflation threshold has remained the same, even as the average rate of inflation has been marginally higher than earlier. J&K is a high-wage economy. Inflation has resulted in the average daily wages of agricultural or construction labour in the UT being the second-highest in the country, after Kerala. In the last six years, the historical structural features of J&K — a high-cost, import-dependent economy with parts of it being export-oriented — have only accentuated. An expansionary public expenditure policy continues as in the past, with the added feature of an overleveraged budget. Hardly the signs of an economy set for a take-off a la Rostow. It is unlikely to engender long-term sustainable economic growth, let alone transformation. The writer is former finance minister of Jammu and Kashmir
Hans India
5 minutes ago
- Hans India
Promoters' holding in listed cos slip to 8-yr low of 40.58%
New Delhi: Promoters' ownership in private listed companies declined to an eight-year low of 40.58 per cent as of June 30, 2025, following a net share sale worth Rs54,732 crore during the quarter, according to data from an initiative of PRIME Database Group. 'While promoter buying is always a positive sign, promoter selling can be due to a wide variety of reasons such as promoters taking advantage of bullish markets to take money off the table, strategic reasons like debt reduction, legacy planning, philanthropy, investment in other ventures and meeting Minimum Public Shareholding (MPS) requirement as also for personal expenses,' said Pranav Haldea, Managing Director, PRIME Database Group. 'Relatively lower promoter holding in some of the recent IPO companies and overall institutionalisation of the market are some of the other reasons behind this fall,' he added. In comparison, private promoters held a 40.81 per cent stake in the quarter ended March 2025. The last time holdings were this low was in the quarter ended September 30, 2017, when private promoter shareholding stood at 40.19 per cent. This trend has been consistent over the past three years. Over the last 13 quarters alone, promoters' share has fallen sharply by 455 basis points from 45.13 per cent on March 31, 2022, to 40.58 per cent as of June 30, 2025. According to Haldea, as long as promoters continue to hold a sizable stake after the sale, with the sale not happening at a huge discount to market price and there being no significant change in the fundamentals of the company, there is no reason to worry. This analysis is based on the shareholding data filed by 2,086 out of the 2,131 companies listed on the main board of the NSE for the quarter ended June 30, 2025. As of July 25, 45 companies had yet to submit their shareholding disclosures. Meanwhile, government holdings as promoters saw a slight increase during the quarter, rising from 9.27 per cent to 9.39 per cent. The share of Domestic Institutional Investors (DIIs) continued to climb, reaching an all-time high of 17.82 per cent as of June 30, 2025, up from 17.62 per cent in the previous quarter. This increase followed a net investment of Rs 1.68 lakh crore during the quarter.
