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UltraTech: Management cautiously optimistic - Views on News from Equitymaster
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UltraTech: Management cautiously optimistic
Jan 22, 2016

UltraTech Cement has announced its financial results for the third quarter of the financial year 2015-16 (3QFY16). During the quarter, the company's consolidated net sales and net profit increased by 4.7% YoY and 36.5% YoY respectively. Here is our analysis of the results:

Performance summary

  • On a consolidated basis, sales rise by 4.7% YoY during the quarter.
  • Operating profits grow by 22.1% YoY as operating margins improve from 15.6% in 3QFY15 to 18.2% in 3QFY16.
  • Finance costs decline by 15% YoY
  • Consolidated net profit increases by 36.5% YoY during the quarter.

Consolidated financial performance snapshot

(Rs m) 3QFY15 3QFY16 Change 9MFY15 9MFY16 Change
Sales 58,319 61,084 4.7% 175,393 184,302 5.1%
Expenditure 49,204 49,957 1.5% 147,017 151,807 3.3%
Operating profit (EBITDA) 9,115 11,127 22.1% 28,375 32,496 14.5%
Operating profit margin (%) 15.6% 18.2%   16.2% 17.6%  
Other income 1,464 1,326 -9.4% 5,033 3,815 -24.2%
Depreciation 2,961 3,389 14.5% 8,972 9,919 10.5%
Finance costs 1,640 1,394 -15.0% 4,268 4,330 1.5%
Profit before tax 5,977 7,670 28.3% 20,168 22,061 9.4%
Tax 1,965 2,200 12.0% 5,716 6,410 12.1%
Effective tax rate 32.9% 28.7%   28.3% 29.1%  
Profit after tax 4,013 5,470 36.3% 14,452 15,652 8.3%
Minority Interest 13 11 -11.7% 41 11 -72.2%
Net profit 4,000 5,459 36.5% 14,411 15,640 8.5%
Net profit margin (%) 6.9% 9.0%   8.2% 8.5%  
No. of shares (m)       274.4 274.4  
Diluted earnings per share (Rs)*         80.9  
P/E ratio (x)*         33.3  

*trailing twelve-month earnings
**Note: On account of the acquisition of Gujarat units of Jaypee Cement Corporation Ltd w.e.f 12 June 2014, the nine month (9MFY16) figures for the company are not strictly comparable with the previous year (9MFY15) figures.

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