Archive · 13 Aug 2026
JP Morgan and Morgan Stanley Prefer UltraTech Cement Over Shree
Two big companies that make cement in India are called UltraTech Cement and Shree Cement.
They both sold a lot more cement this year than last year.
But UltraTech made more profit on each tonne of cement than Shree Cement.
Shree Cement had trouble because the fuel it uses to make cement became more expensive and harder to get.
Two important banks, JP Morgan and Morgan Stanley, studied both companies and said UltraTech is doing a better job.
The banks think UltraTech is the better choice for investors.
Shree Cement's leaders believe their problems will get better starting next quarter.
They say fuel prices have almost stopped going up.
UltraTech's leaders are also hopeful because people want lots of cement for building homes and roads.
Both companies plan to build more cement plants in the future.
Brokerages JP Morgan and Morgan Stanley both preferred UltraTech Cement over Shree Cement after Q1 FY27 results, citing pricing and cost control.
UltraTech's operating EBITDA per tonne stayed above Rs 1,200, while Shree Cement's fell to Rs 1,111 from Rs 1,339 a year earlier.
UltraTech's consolidated volume rose 12.2% year-on-year to 41.31 million tonnes with 81% capacity utilisation; Shree's volume grew more than 15% to 114.5 lakh tonnes at 62% utilisation.
Shree Cement's pet coke share of its fuel mix dropped to 9% from 54% while coal rose to 81% from 32%, driving up fuel costs amid the West Asia disruption.
UltraTech expects capacity additions and cost initiatives to support performance, while Shree expects profitability to recover from Q2 FY27 as contracted pet coke arrives.
- Who
- UltraTech Cement and Shree Cement, analysed by brokerages JP Morgan and Morgan Stanley.
- What
- Both brokerages preferred UltraTech Cement over Shree Cement after Q1 FY27 results, as UltraTech kept strong margins while Shree's operating EBITDA per tonne fell on higher fuel and raw-material costs.
- When
- Q1 FY27, with Q2 identified in the article as the July-September quarter.
- Where
- India, with Shree Cement also expanding in the UAE at Ras Al Khaimah; the West Asia disruption affected fuel costs.
- Why
- UltraTech absorbed cost pressure and kept operating EBITDA per tonne above Rs 1,200, while Shree faced a fuel-mix disruption that cut its margin.
Shree Cement's recovery outlook
Brokerages' cautious cost view
Fuel cost trajectory
Shree Cement's recovery outlook
Shree Cement's Ashok Bhandari says fuel prices have almost peaked and lower-cost contracted pet coke is arriving, so fuel and raw-material costs should stabilise or decline if the Middle East does not worsen.
Brokerages' cautious cost view
Morgan Stanley expects elevated costs to continue through Q2 FY27 before gradually normalising in the second half of FY27, provided geopolitical conditions do not worsen.
Which cement stock to prefer
Shree Cement's recovery outlook
JP Morgan and Morgan Stanley prefer UltraTech Cement over Shree Cement, citing UltraTech's scale, margins and ability to manage pricing and volumes.
Brokerages' cautious cost view
Shree Cement's management expects healthier profitability from Q2 FY27 onwards, with more than 15% volume growth, pointing to a recovery path for the company.
- Brokerage pick
- UltraTech Cement (preferred by both JP Morgan and Morgan Stanley)
- UltraTech operating EBITDA per tonne
- Above Rs 1,200 in Q1 FY27
- Shree operating EBITDA per tonne
- Rs 1,111, down from Rs 1,339 in Q1 FY26
- UltraTech consolidated volume
- 41.31 million tonnes, up 12.2% YoY
- Shree consolidated volume
- 114.5 lakh tonnes, up more than 15% YoY
- Capacity utilisation
- UltraTech 81%; Shree Cement 62%
- Shree FY27 capex guidance
- Rs 1,500 crore (Rs 456 crore spent in Q1 FY27)
- UltraTech net debt to EBITDA
- 0.87x at the end of Q1 FY27