UltraTech requires more than volumes

Investors in UltraTech Cement Ltd's shares need two things to go hand-in-hand: volumes and price realizations. The company's capacity expansion plans seem to be on track, but hopes of cement prices staying high consistently could get dashed.

- Harsha Jethmalani

For now, the management has indicated that prices have sustained in most markets. The industry has increased prices in September and October in most regions, taking the current all-India (average) prices 7-8% higher versus June, the management said in its September quarter (Q2FY24) earnings call. This could boost sequential realisations growth. Usually, pricing tends to be strong in the second half of the financial year. But peers are also adding capacities and competition should stiffen, especially as election-led demand gradually wanes, potentially weighing on prices.