UltraTech Cement slips after Q1 results; brokerages see up to 18% upside

Shares of UltraTech Cement fell in Tuesday’s trade even as the cement maker reported a strong 49 per cent year-on-year (YoY) jump in its consolidated net profit for the first quarter of FY26. 

The cement major's stock fell 2.1 per cent to Rs 12,300 on BSE over its previous close of Rs 12,574.35. With this, the scrip is off 3.2 per cent from 52-week high of Rs 12,711.95.

The Aditya Birla Group company reported a profit after tax (PAT) of Rs 2,226 crore for the June quarter. A couple of brokerages stayed bullish on the counter, seeing a decent upside potential, driven by a strong demand outlook and operational efficiencies.

UltraTech Cement target prices:
Leading brokerage firms such as Motilal Oswal Financial Services (MOFSL) and ICICI Securities have maintained their 'Buy' ratings on the stock following the Q1 results. They gave price targets that suggested up to 18 per cent potential upside.

MOFSL has reiterated its 'BUY' call, with a target price of Rs 14,600, up 18.6  per cent from Tuesday's low of Rs 12,300. The brokerage values the company at 20 times its estimated June 2027 EV/Ebitda. "UltraTech Cement remains our preferred pick in the cement space given its leadership position, successful integration of acquired assets, cost-saving initiatives, and strong balance sheet," MOFSL said.

“Over the years, the company has balanced out its pan-India presence with all-round capacity expansions. We believe the company should benefit from a recovery in cement demand and a positive pricing trend,” MOFSL added.

MOFSL said UltraTech's Q1 earnings were in line with its estimates, with management guiding for double-digit volume growth in FY26. The brokerage highlighted that healthy demand was driven by a pickup in government-led infrastructure projects and expects a recovery in rural and urban housing markets to further boost demand.

"We believe the company should benefit from a recovery in cement demand and a positive pricing trend," MOFSL noted, forecasting a robust 25 per cent and 30 per cent CAGR in consolidated EBITDA and PAT, respectively, between FY25 and FY28.

Similarly, ICICI Securities maintained a 'BUY' rating and revised its target price to Rs 14,600. The firm values UltraTech at 19 times its FY27 estimated EV/EBITDA. "A convincing start to FY26... The earnings momentum may pace up further, tracking UTCEM’s commentary of firm prices sustaining in the seasonally weak Q2," said ICICI Securities.

ICICI Securities said this positive sentiment, attributed to an improved price environment, benefits from mergers and acquisitions, and sustained efficiency measures.

Axis Securities recommended a 'Buy' rating on the stock with a target price of Rs 13,840 against Rs 13,510 per share earlier.

Meanwhile, YES Securities suggested a 'Sell' call on the stock. "We maintain a SELL rating on UltraTech Cement with a revised TP of Rs10,110 (earlier Rs10,005), valuing the company at 16x FY27E EV/Ebitda. “We remain bearish on UltraTech due to the weak performance of the acquired assets and high valuations. Any significant price hikes, increased utilisation, and effective cost savings are key upside risks to our estimates," it said.