UltraTech Cement Upgraded to Hold, Target Price Rs 11,900 by ICICI Securities

UltraTech Cement Delivers Flawless Q4FY26 Performance, But ICICI Securities Remains Cautious

UltraTech Cement (UTCEM) has reported a strong performance in the fourth quarter of fiscal year 2026 (Q4FY26), exceeding the expectations of ICICI Securities. The company's earnings before interest, taxes, depreciation, and amortization (EBITDA) was 13% higher than the research firm's estimates, with a beat across realisation and costs.

Despite the optimistic management commentary, which aims to mitigate the impact of rising crude oil prices in the near term, ICICI Securities remains cautious in upgrading its earnings forecasts. The worsening sector fundamentals, driven by increased competitive intensity due to significant capacity additions and uncertainty surrounding fuel costs, justify the research firm's cautious stance.

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ICICI Securities maintains its valuation of UltraTech Cement at 17 times its estimated earnings before interest, taxes, depreciation, and amortization (EV/EBITDA) for fiscal year 2028 (FY28E) and recommends a HOLD rating with an unchanged target price of INR 11,900. The company has also surprised investors with its highest-ever dividend payout of INR 240 per share, which is a significant increase from the INR 77.5 per share payout in the previous year. Historically, UltraTech Cement has tended to either sustain or increase its dividend run-rate.