UltraTech Cement Raises Rs 3,000 Crore via NCDs Amid Financial Setbacks

UltraTech Cement, the Aditya Birla Group’s flagship company, plans to raise up to Rs 3,000 crore through the private placement of non-convertible debentures (NCDs) to bolster its financial position in light of heightened competition. The finance committee has approved the issuance of rupee-denominated, unsecured, redeemable, and listed NCDs in one or more tranches.

In Q2 FY2025, UltraTech reported a 36% year-on-year (YoY) drop in net profit, falling to Rs 825 crore, which missed analysts’ expectations of Rs 939 crore. Revenue also declined by 2% YoY, amounting to Rs 15,635 crore, while EBITDA margins contracted by 300 basis points YoY, dropping to 12.9%. The company’s net debt surged to Rs 8,793 crore as of September 2024, compared to Rs 2,779 crore in March 2024.

Despite the challenging financials, UltraTech saw a 3% YoY growth in domestic sales, driven by strong demand. Lower energy costs, which dropped 14% YoY, partially mitigated the impact of rising raw material prices.

In a strategic move, UltraTech invested Rs 3,954 crore in India Cements, acquiring a 32.7% equity stake, reinforcing its position in the competitive South Indian market. This aligns with its efforts to expand market share, where it holds an 11% stake, surpassing Adani Group’s 6%.

Earlier, UltraTech raised $500 million through a sustainability-linked loan, emphasizing its commitment to sustainable growth. The company remains optimistic about achieving 7–8% growth, driven by government infrastructure projects and rising urban housing demand.