UltraTech Cement trades 2% higher on Rs 32,000-cr capex, plants going on stream

Shares of UltraTech Cement Limited traded over 2 percent higher to Rs 10,278 on April 3 morning after the company put on stream two greenfield projects in Chhattisgarh and Tamil Nadu.

Its total domestic grey cement manufacturing capacity now stands augmented to 146.2 metric tonnes per annum (mtpa). Along with its existing capacity of 5.4 mtpa in the UAE, the company now has a total capacity of 151.6 mtpa.

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The company has subsequently added the next 50 mtpa in less than five years with an investment of around Rs 32,000 crore. "Over the past two decades, "UltraTech has grown 11 times, far outpacing the industry growth of four times," Aditya Birla Group cement flagship said in a regulatory filing.

KC Jhanwar, the managing director of the company said that India’s strong growth trajectory provides the cement sector significant headroom for long term growth. Given the consolidated postion in the industry, the company is well placed to support the country in its exciting growth journey ahead, he further added.

Morgan Stanley has assigned an 'overweight' call on the stock. With a price target price of Rs 12,000, it implies an upside of 19.5 percent from the last closing of Rs 10,038. "It continues to be focused on capacity market share gains as it remain key to volumes," the brokerage said in a note. "Size, pan-India presence and balance sheet strength makes the company best positioned in the industry."

In late March, the Competition Commission of India (CCI) approved the company's proposed acquisition of Kesoram Cement business from Kesoram Industries.

At 9:20am, the stock was trading at Rs 10,185, up 1.6 percent from the previous close on the NSE. The counter has slipped over 4 percent since the start of the year.

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