UltraTech margin recovery widens as revenue growth outpaces costs
Consolidated operating margin rose 3.77 percentage points QoQ, while a higher tax rate limited the earnings lift from the stronger operating performance.
Filed 27 Apr 2026, 14:26 IST · UltraTech Cement Ltd (ULTRACEMCO)
Key takeaways
- Consolidated revenue grew +11.86% YoY while expenses rose +9.51%, lifting operating margin by 1.68 percentage points to 21.71%.
- Net profit increased +21.22% YoY despite a 4.44 percentage-point rise in the tax rate to 24.63%, so the gain was not tax-led.
Price around the results
Revenue growth drives a sharper margin recovery
UltraTech Cement's consolidated revenue rose +18.19% QoQ, ahead of the +12.75% increase in expenses, lifting operating profit by +43.04% and margin by 3.77 percentage points. The YoY comparison also improved, with revenue growth of +11.86% exceeding expense growth of +9.51%. At 21.71%, operating margin was 2.94 percentage points above the 18.77% median for 51 reported Commodities peers.
Higher tax rate offsets part of operating gain
Profit before tax grew +28.37% YoY, but net profit rose a slower +21.22% as the tax rate increased to 24.63% from 20.19%, a 4.44 percentage-point rise. Interest increased +2.50% and depreciation rose +7.43% YoY, adding to the charges below operating profit. Other income contributed only 1.89% of pre-tax profit, so it was not a material source of earnings quality or growth.
Operating margin has recovered for two straight quarters
Margin fell from 20.73% in Q1FY26 to 15.78% in Q2FY26, then recovered to 17.94% in Q3FY26 and 21.71% in Q4FY26. The latest quarter therefore marks a second consecutive quarter of improvement and puts margin above the 20.03% recorded in Q4FY25. QoQ profit growth was also amplified by the operating recovery, with net profit up +73.47%.
Initial market response turned weaker over time
The stock closed up +0.10% on the results date after opening with a +1.25% gap, then returned -1.51% on the next session and -0.29% after five sessions. Its previous eight results produced four rises and four falls, with a 1.18% median absolute move, making the later decline more pronounced than its usual immediate reaction.
Q4FY26 at a glance
Consolidated figures as filed with NSE — cross-checked against an independent source.
| Line item | Q4FY26 | Q3FY26 | QoQ | YoY |
|---|---|---|---|---|
| Revenue | ₹25,799 cr | ₹21,830 cr | +18.19% | +11.86% |
| Other income | ₹75 cr | ₹42 cr | +79.68% | -8.24% |
| Expenses | ₹20,199 cr | ₹17,914 cr | +12.75% | +9.51% |
| Operating profit | ₹5,600 cr | ₹3,915 cr | +43.04% | +21.26% |
| Operating margin (%) | 21.71% | 17.94% | — | — |
| Interest | ₹487 cr | ₹492 cr | -1.07% | +2.50% |
| Depreciation | ₹1,208 cr | ₹1,182 cr | +2.22% | +7.43% |
| Profit before tax | ₹3,981 cr | ₹2,283 cr | +74.35% | +28.37% |
| Tax | ₹981 cr | ₹554 cr | +77.12% | +56.62% |
| Net profit | ₹3,000 cr | ₹1,729 cr | +73.47% | +21.22% |
| EPS (₹) | ₹101.41 | ₹58.66 | +72.88% | +20.18% |
Operating margin of 21.71% compares with a Commodities sector median of 18.77% across 51 peers that have reported Q4FY26.
How the stock reacted
| Window | Stock | vs NIFTY |
|---|---|---|
| Results day | +0.10% | -0.71% |
| Next session | -1.51% | — |
| 5 sessions | -0.29% | -0.86% |
| 15 sessions | -5.25% | — |
| 30 sessions | -9.43% | — |
Volume on the results session was 1.59× its 20-day average.
What to watch
- Whether consolidated operating margin holds above 21.71% after rising from 17.94% in Q3FY26.
- Whether revenue growth remains ahead of expense growth, as in +11.86% versus +9.51% YoY.
- The next tax rate relative to 24.63%, after the 4.44 percentage-point YoY increase.