The India Cements Limited — Q4 FY26 earnings call

Call held 27 Apr 2026

Management summary

This analysis is based on the UltraTech Cement Limited Q4 FY26 earnings call, which discussed India Cements as an acquired subsidiary. India Cements showed significant sequential improvement, reporting a PAT of INR 60 crores and an EBITDA per ton of INR 497 in Q4 FY26. The brand migration to UltraTech is complete, and substantial investments are underway to drive efficiency and capacity, targeting over INR 1,000 EBITDA per ton by FY28. However, the full merger is delayed by legal complexities.

Highlights

  • India Cements' PAT for Q4 FY26 was INR 60 crores, marking a significant improvement after a long time.

  • EBITDA per ton for India Cements improved sequentially to INR 497 in Q4 FY26, up from INR 305 in Q3 FY26.

  • Effective EBITDA per ton for India Cements, after accounting for UltraTech's markup, reached INR 670.

  • 100% brand migration of India Cements' volumes to the UltraTech brand was completed by March 2026, ahead of schedule.

  • UltraTech has committed substantial capex for efficiency and capacity expansion within India Cements, targeting over INR 1,000 EBITDA per ton by FY28.

Concerns

  • The full merger of India Cements with UltraTech is pending due to complicated legal issues inherited from the acquisition, with no clear timeline.

  • India Cements' operational progress is still being integrated and its full earnings potential is yet to be realized.

  • The impact of West Asia crisis on fuel costs and rupee devaluation affected overall profitability, though specific quantification for India Cements was not provided.

Key financials

2 periods

Headline

  • India Cements PAT
    ₹60 Cr
  • India Cements EBITDA/ton (Effective)
    ₹670

Q4 FY26

  • India Cements EBITDA/ton
    ₹497
    QoQ +62.9%
  • India Cements Volumes
    3.12 million tons

What they filed

Q1 FY27: revenue down 0.6%, net profit up 120.3% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue1,022 940 1,198 1,025 1,117 +9%1,114 +19%1,229 +3%1,019 −1%
EBITDA-163 -190 -2 83 81 +150%79 +142%153 +7750%156 +88%
Net profit-339 119 18 -133 9 +103%-3 −103%60 +233%27 +120%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Capital allocation

high confidence
  • Capex Capex disclosed
    • Efficiency improvement for India Cements ₹1,592 Cr
    • Capacity expansion for India Cements ₹400 Cr
    We had committed INR1,592 crores for India Cements for efficiency improvement, plus another INR400 crores for capex on capacity expansion, this definitely is going to take us over INR1,000 per ton, as committed by the end of fiscal '28.
  • M&A India Cements Acquisition · Integrated

    Strategic acquisition to build scale, improve cost efficiency, market reach, raw material security, and sustainability.

    Moving from integration drag to earnings contributor; cost improvement capex will lead to meaningful and growing source of group-level EBITDA accretion.

    Fiscal '26 was a year of extraordinary execution. We crossed 200 million tons of capacity. We completed brand migration for both India Cements and Kesoram ahead of schedule. ... India Cements EBITDA of INR497 per ton in Q4 '26 up from INR333 in Q2 and INR305 in Q3.

Guidance & targets

Capacity

  • India Cements EBITDA/ton Capacity · by fiscal '28 · High confidence over INR1,000 per ton
    this definitely is going to take us over INR1,000 per ton, as committed by the end of fiscal '28.

    — Atul Daga

Cost Efficiency

  • India Cements efficiency improvement Cost Efficiency · ongoing · High confidence INR200 per ton
    We are still seeing INR200 per ton of efficiency improvement, which will come into the kitty of India Cements.

    — Atul Daga

Clinker Factor

  • Clinker conversion ratio Clinker Factor · by fiscal '28 · High confidence 1.54x
    We have targeted to reach about 1.54x. That road map is already there and let's see how things shape up beyond that. ... Second point, 1.54x is our target to reach by fiscal '28.

    — Atul Daga

What to watch in Q1 FY27

India Cements EBITDA/ton trajectory

next quarter
Current INR 497 per ton (Q4 FY26)
Target Progress towards INR 1,000 per ton by FY28

Why it matters

Tracking this metric will indicate the effectiveness of UltraTech's integration and efficiency improvement initiatives for India Cements.

India Cements EBITDA of INR497 per ton in Q4 '26 up from INR333 in Q2 and INR305 in Q3. ... this definitely is going to take us over INR1,000 per ton, as committed by the end of fiscal '28.

Risks & concerns

  • Delay in India Cements' full merger due to legal issues

    medium

    Complicated legal issues inherited from the acquisition are delaying the full merger of India Cements with UltraTech, with no clear timeline for resolution.

    Analyst acknowledged

  • Impact of West Asia crisis on fuel and logistics costs

    medium

    The conflict in West Asia poses a real headwind on fuel costs, packing bags, freight, and import-dependent supply chains, potentially impacting profitability.

    Management acknowledged

  • Rupee devaluation impact on foreign currency borrowings

    medium

    A mark-to-market impact from rupee devaluation (e.g., INR 94.85 to dollar) on foreign currency borrowings resulted in a non-cash debit to the P&L.

    Management acknowledged

  • Increased packing bag costs

    medium

    Packing bag costs increased significantly in March, leading to an incremental cost of approximately INR 90 crores for the quarter, though prices have since stabilized.

    Management acknowledged

Q&A highlights

3 direct
India Cements merger timeline and legal issues Partial
There are those complicated legal issues, which we have inherited. As I mentioned, we don't want to take any risks with UltraTech, the main company and our main Board. And we are trying our level best to get those cases closed because they are donkey's years old cases and there's been no movement, nothing. Once we are convinced that there is no risk to us. We could look at the next phase of integration.

Reveals that the full merger of India Cements into UltraTech is stalled due to inherited legal complexities, impacting the timeline for complete integration benefits.

Asked by Ritesh Shah

Impact of brand conversion on India Cements' realization Direct
Significantly because if I were to look at, let's say, India Cements volumes for the quarter of 3.12 million tons, non-UltraTech volume was 0.39 million tons only. And everybody knows that UltraTech enjoys a premium positioning with brand transition that has definitely helped.

Confirms that the brand migration of India Cements' products to the UltraTech brand has significantly improved realizations due to UltraTech's premium positioning.

Asked by Rahul Gupta

India Cements' EBITDA contribution and future potential Direct
INR200 of EBITDA per ton on India Cements volume, which is sitting in UltraTech books. The INR497 for the quarter and during the quarter, gradually the transition was done. So we have reached a number of INR670 per ton on India Cements. Now if price increases, along with efficiencies, new capacity addition, operating leverage, everything will take us beyond INR1,000 mark.

Clarifies the current effective EBITDA per ton for India Cements and outlines the path to achieving over INR 1,000 per ton through price increases, efficiencies, and capacity additions.

Asked by Jashandeep Singh Chadha

Quantification of India Cements' efficiency improvement program Direct
I should have thumped my hand on the table and told you. As promised and we have delivered it. So we are at almost INR185 per ton on nominal basis, we have completed. And all these programs which are there, which will take us beyond INR300, whilst we had committed INR300, because I'm keeping, let's say, an emergency or a buffer in my pocket, but I think we will deliver higher than INR300 is what we're looking at.

Provides an update on the efficiency improvement program for acquired assets (including India Cements), indicating significant progress and potential to exceed initial targets.

Asked by Prateek Kumar

Impact of West Asia conflict on costs and mitigation strategies Partial
Yes, there are several measures and for the sake of confidentiality, I might not be able to reveal trade secrets. But diversifying my sources of procurement, identifying newer opportunities to deal with the situation, doing long-term contracts for fuel, which are going to be beneficial to us now.

Highlights management's proactive measures to mitigate external cost pressures, such as diversifying procurement and securing long-term fuel contracts, which are crucial for maintaining profitability.

Asked by Pulkit Patni

2 min read 4 chapters

Detailed narrative

India Cements Integration and Performance

India Cements, as an acquired subsidiary of UltraTech, demonstrated significant sequential improvement in Q4 FY26. The company reported a PAT of INR 60 crores for the quarter, a notable achievement after a long period. Its EBITDA per ton reached INR 497 in Q4 FY26, a substantial increase from INR 305 in Q3 FY26. After accounting for UltraTech's markup, the effective EBITDA per ton for India Cements stood at INR 670. Total volumes for India Cements in Q4 FY26 were 3.12 million tons, with only 0.39 million tons still under non-UltraTech brands.

Brand Migration and Operational Efficiency

The brand migration of India Cements' products to the UltraTech brand was successfully completed by March 2026, ahead of schedule. This full conversion is expected to enhance realizations due to UltraTech's premium market positioning. UltraTech has committed INR 1,592 crores for efficiency improvement and an additional INR 400 crores for capacity expansion within India Cements. These investments are projected to elevate India Cements' EBITDA per ton to over INR 1,000 by the end of fiscal '28, with INR 200 per ton of efficiency improvement already being realized.

Challenges and Mitigation Strategies

Despite the operational progress, the full merger of India Cements with UltraTech is pending due to complex legal issues inherited from the acquisition, with no specific timeline for resolution. The overall business faced headwinds from the West Asia crisis, impacting fuel costs, packing bags, and freight. Rupee devaluation also led to a non-cash mark-to-market debit on foreign currency borrowings. Management is actively implementing mitigation strategies, including diversifying procurement, securing long-term fuel contracts, and increasing prices to cushion the impact of rising input costs.

Future Outlook and Strategic Goals

UltraTech views India Cements as transitioning from an integration drag to a meaningful earnings contributor. The ongoing cost improvement capex is expected to drive significant group-level EBITDA accretion. The company targets a clinker conversion ratio of 1.54x by fiscal '28, which India Cements will contribute to. The focus remains on disciplined organic growth, timely acquisitions, and relentless execution to strengthen market position and profitability.

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