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

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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.

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