UltraTech shares edge up on launch of Ultravolt, plans to scale its EV truck fleet
The Ultravolt wires and cables business has been set up with an initial investment of ₹1,800 crore and a manufacturing plant in Gujarat’s Bharuch district
UltraTech Cement, a company under the Aditya Birla Group, experienced a slight increase in its shares, trading up by 0.47% at ₹11,328 on Friday. This rise in stock price was in response to two significant announcements made by the company over the past two trading sessions. The first announcement is the formal launch of Ultravolt, UltraTech's wires and cables business, which began commercial production on September 1.
Located in Jhagadia, Gujarat's Bharuch district, the business was set up with an initial investment of ₹1,800 crore and has an installed capacity of 1.1 million km. UltraTech aims to become one of the top two players in the wires segment within five years, a goal that analysts believe reflects the group's aggressive approach in other businesses, such as paints through Birla Opus.
The launch of Ultravolt came ahead of the previously stated December timeline. Morgan Stanley, which holds an Overweight rating with a target price of ₹14,700, mentioned that around ₹890 crore had already been invested as of June-end, given the total budget of ₹1,800 crore. This swift execution is seen as a positive sign. Jefferies, with a Buy rating and a target price of ₹14,065, believes that Ultravolt could contribute 3-7% of UltraTech's FY30 revenue and EBITDA if it scales up.
Motilal Oswal, maintaining a Buy rating with a target price of ₹13,800, estimates that Ultravolt could capture 5-7% of the market share in cables and wires by FY31. In addition to the launch of Ultravolt, UltraTech also announced plans on September 2 to scale its electric truck fleet to over 600 vehicles by December 2026. This expansion aims to transport 5 million metric tonnes of clinker annually, resulting in a potential CO₂ reduction of over 1,17,000 tonnes per year.
At the current stock price, UltraTech trades at a trailing P/E ratio of 38.76. The stock has decreased by approximately 10.45% over the past year, compared to the Nifty 50's 3.11% decline during the same period. Its 52-week high stands at ₹13,110, which was hit in February.
Written by urgent.news from Hindu BusinessLine's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
