UltraTech Cement Unveils Major Investment Strategy for India Cements Subsidiary
In a significant move to strengthen its market position, UltraTech Cement has announced a substantial capital expenditure program of approximately Rs 2,000 crore over the next two years for its subsidiary, India Cements. This strategic investment is aimed at driving growth, improving operational efficiency, and significantly reducing operating costs across the company's manufacturing facilities.
Focus on Infrastructure Upgrades and Energy Efficiency
The planned investments will concentrate on modernizing manufacturing infrastructure and enhancing energy efficiency through several key initiatives. These include:
- Converting existing four- and five-stage preheaters to more advanced six-stage systems
- Upgrading cooler systems for better thermal management
- Implementing process optimization measures to reduce heat consumption
- Installing 21.8 MW of waste heat recovery systems (WHRS) to capture and reuse thermal energy
Additionally, the company will invest in digitization and productivity-related initiatives designed to improve equipment reliability and reduce overall power consumption.
Sustainability Goals and Capacity Expansion
As part of its comprehensive sustainability push, UltraTech Cement plans to dramatically increase green power consumption for India Cements. The company aims to boost the share of renewable energy and WHRS from just 5% in FY25 to approximately 80% by FY29, representing a major commitment to environmentally responsible operations.
This investment program will also facilitate significant capacity expansion. The total cement capacity of India Cements is projected to increase to 17.55 million tonnes by March 2027, up from 14.75 million tonnes in December 2025.
Funding Strategy Through Asset Monetization
To support this ambitious capex program while maintaining financial discipline, UltraTech Cement plans to raise funds through the monetization of non-core assets belonging to India Cements. This approach is designed to keep debt levels under control while financing the growth initiatives.
During the company's Q3 FY26 earnings call, management revealed that it has already completed the sale of its coal mining subsidiary in Indonesia, with all proceeds fully realized. Furthermore, discussions are currently underway for the sale of large land parcels, which could generate at least Rs 500 crore in additional funds.
"There are a couple of big land parcels under discussion with potential buyers," stated Atul Daga, Business Head and CFO of UltraTech Cement. He added that the company is also examining legal options related to certain attached assets before making further decisions regarding their disposition.
The company has already realized more than Rs 200 crore through earlier asset sales, demonstrating the effectiveness of this funding strategy.
Financial Performance Improvement
The investment announcement comes as India Cements shows marked improvement in its financial performance. For the December 2025 quarter, the subsidiary posted standalone total income of Rs 1,140 crore, compared with Rs 913 crore in the same period the previous year.
More significantly, EBITDA turned positive at Rs 105 crore against a loss of Rs 178 crore a year earlier. The loss after tax also narrowed substantially to just Rs 6 crore from Rs 409 crore in the year-ago period, indicating a strong recovery trajectory.
This comprehensive investment and growth strategy positions UltraTech Cement and its India Cements subsidiary for enhanced competitiveness in the rapidly evolving construction materials market, while simultaneously advancing sustainability objectives through increased green energy adoption.
