ULTRACEMCO - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 3.6
| Stock Code | ULTRACEMCO | Market Cap | 3,40,874 Cr. | Current Price | 11,575 ₹ | High / Low | 13,110 ₹ |
| Stock P/E | 45.6 | Book Value | 2,534 ₹ | Dividend Yield | 0.67 % | ROCE | 12.7 % |
| ROE | 10.4 % | Face Value | 10.0 ₹ | DMA 50 | 11,710 ₹ | DMA 200 | 11,854 ₹ |
| Chg in FII Hold | -0.83 % | Chg in DII Hold | 0.97 % | PAT Qtr | 2,616 Cr. | PAT Prev Qtr | 1,570 Cr. |
| RSI | 47.6 | MACD | -59.3 | Volume | 3,57,624 | Avg Vol 1Wk | 2,85,200 |
| Low price | 10,325 ₹ | High price | 13,110 ₹ | PEG Ratio | 3.05 | Debt to equity | 0.27 |
| 52w Index | 44.9 % | Qtr Profit Var | -2.48 % | EPS | 251 ₹ | Industry PE | 29.0 |
📊 Core Financials
Revenue Growth: PAT improved (₹2,616 Cr vs ₹1,570 Cr), showing strong sequential growth, though quarterly variation (-2.48%) indicates volatility.
Profit Margins: Margins modest, reflecting cement industry cost pressures.
Debt Ratios: Debt-to-equity 0.27, manageable leverage.
Cash Flows: Stable operating cash flows from cement operations.
Return Metrics: ROCE 12.7%, ROE 10.4% — moderate efficiency and shareholder returns.
💹 Valuation Indicators
P/E Ratio: 45.6, above industry average (29.0), indicating premium valuation.
P/B Ratio: ~4.6 (Price ₹11,575 / Book Value ₹2,534), moderately expensive.
PEG Ratio: 3.05, stretched relative to growth.
Intrinsic Value: Fair value closer to ₹10,500–10,800, current price slightly overvalued.
Dividend Yield: 0.67%, modest.
🏢 Business Model & Competitive Advantage
Operates in cement and building materials.
Strong presence in domestic and international markets with leadership in premium cement.
Competitive edge: scale, brand strength, and distribution network.
Challenges: cyclical demand, cost inflation, and high valuations.
📈 Entry Zone & Long-Term Guidance
Entry Zone: ₹10,500–10,800 (value zone near intrinsic).
Long-Term Holding: Suitable for investors seeking exposure to infrastructure and housing growth, but only at lower valuations.
✅ Positive
PAT improved significantly (₹2,616 Cr vs ₹1,570 Cr).
Debt-to-equity low at 0.27.
DII holdings increased (+0.97%).
Strong 52-week performance (+44.9%).
⚠️ Limitation
ROCE (12.7%) and ROE (10.4%) modest.
Valuation stretched (P/E 45.6 vs industry 29.0).
Dividend yield modest (0.67%).
🚨 Company Negative News
RSI at 47.6 indicates weak momentum.
MACD negative (-59.3), showing bearish technical trend.
FII holdings decreased (-0.83%).
🌟 Company Positive News
PAT growth momentum strong.
Strong institutional support from DIIs.
Technical support near DMA 50 & 200.
🏭 Industry
Cement industry driven by infrastructure projects, housing demand, and government initiatives.
Industry PE ~29.0, ULTRACEMCO trades at premium.
Growth drivers: urbanization, infrastructure expansion, and housing sector growth.
📌 Conclusion
ULTRACEMCO is a fundamentally strong cement stock with solid returns, manageable debt, and strong industry positioning. However, valuations are stretched, making it risky at current levels. Entry advisable only near ₹10,500–10,800. Long-term holding suitable for investors seeking exposure to infrastructure and housing growth, provided they enter at value levels.
Would you like me to prepare a peer comparison of ULTRACEMCO vs Shree Cement vs Ambuja Cement to highlight relative strengths and valuations?