Ultratech Cement: The Undisputed Market Leader

Aditya Birla Group’s flagship company, UltraTech Cement Limited is becoming a powerhouse in the cement industry capturing most of the market with its rapid expansion, right now UltraTech is the largest manufacturer of grey cement and ready mix concrete (RMC) in India, additionally, it is also one of the largest manufacturers of white cement in India. Globally, it ranks as the third largest cement producer, excluding China.

Market Dominance

UltraTech Cement Ltd holds a market share of 25.9% with a market capitalisation of Rs. 2,87,744 Crore. UltraTech holds an extensive distribution network that established an extensive connection across the country. This network enables the company to reach even the most remote areas, contributing significantly to its dominance in the cement market in India.

Ultratech Cement consistently boasts high capacity utilisation rates, averaging over 80% across its facilities in India. This efficient utilisation further solidifies its leading position in the Indian cement market. 

Ambitious Capex

Ultratech Cement Ltd has commissioned two new greenfield capacity capex totalling 5.4 MTPA in the states of Chhattisgarh and Tamil Nadu, this will take the company’s total cement capacity to 151.6 MTPA. One of the most impressive facts is that Ultratech has added more than 50 MTPA in less than 5 years with an investment of around Rs. 32,000 Crores and to make them an undisputed market leader they’re committing to a capex of Rs.32,400 Crores for the next three years,

To look at the company’s progress from a shorter horizon, in the last year UltraTech has added a capacity of 18.7 MTPA, and there are many ongoing projects which will further add 35.5 MTPA across 16 locations. The company is also in the final stages of closing the proposed acquisition of Kesoram Cement. This will further augment UltraTech’s grey cement capacity to 198.2 MTPA.

Acquisitions

The acquisition of Kesoram Cement is just one of many acquisitions made by UtraTech Cement, they have a long history of acquisitions and this is how they’ve been adding capacity to grow stronger in the market, one of the most notable acquisitions of UltraTech Cement are; Binani Cement where UltraTech acquired it for a whopping $1.14 Billion, Star Cement, the acquisition came from the United Arab Emirates but the amount was undisclosed, National Limestone was acquired by UltraTech for $3.1 Million.

Conclusion: In the fiercely competitive cement industry, Ultratech Cement has emerged as a dominant force. Ultratech aims to increase its capacity by a staggering 45%, reaching 200 Million tons—no small feat. With a relentless focus on expansion through capital expenditure and strategic acquisitions, Ultratech has solidified its position at the top.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.