Q1 2027 JK Lakshmi Cement Ltd Earnings Call

August 6, 2026

Operator: Ladies and gentlemen, thank you for your patience. The conference of JK Lakshmi Cement Limited will begin shortly. Please stay connected and do not disconnect. Ladies and gentlemen, thank you for your patience. The conference of JK Lakshmi Cement Limited will begin shortly. Please stay connected and do not disconnect. Thank you. Ladies and gentlemen, good day, and welcome to the earning conference call for the quarter ended 30 June 2026 of JK Lakshmi Cement Limited, hosted by PhillipCapital India Private Limited. As a reminder, all participant lines will remain in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal the operator by pressing star then zero on your touchtone telephone. Please note that this conference is being recorded.

Speaker #1: Ladies and gentlemen, thank you for your patience. The conference for JK Lakshmi Cement Limited will begin shortly. Please stay connected and do not disconnect.

Speaker #1: Thank you. Ladies and gentlemen, good day and welcome to the Earnings Conference Call for the quarter ended 30th June 2026 of JK Lakshmi Cement Limited, hosted by PhillipCapital (India) Private Limited.

Operator: Ladies and gentlemen, good day, and welcome to the Earning Conference Call for the Quarter ended 30 June 2026 of JK Lakshmi Cement Limited, hosted by PhillipCapital India Private Limited. As a reminder, all participant lines will remain in the listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal the operator by pressing star then zero on your touchtone telephone. Please note that this conference is being recorded. I will now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital India Private Limited. Thank you, and over to you.

Speaker #1: As a reminder, all participant lines will remain in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes.

Speaker #1: Should you need assistance during the conference call, please signal the operator by pressing star then zero on your touch-tone telephone. Please note that this conference is being recorded.

Speaker #1: I will now hand the conference over to Mr. Vaibhava Garwal from Philip Capital India Private Limited. Thank you, and over to you.

Operator: I will now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital India Private Limited. Thank you, and over to you.

Speaker #2: Yeah, thank you, Ryan. Good evening, everyone. On behalf of PhillipCapital (India) Private Limited, we welcome you to the Q1 FY27 call of JK Lakshmi Cement Limited.

Vaibhav Agarwal: Thank you, Ryan. Good evening, everyone. On behalf of PhillipCapital India Private Limited, we welcome you to the Q1 FY27 call of JK Lakshmi Cement Limited. On the call from JK Lakshmi Cement, we have with us Mr. Arun Shukla, President and Director, and Mr. Sudhir Bidkar, Executive Directors, Corporate Affairs, and CFO of the company. I would like to mention on behalf of JK Lakshmi Cement Limited and its management that certain statements that may be made or discussed on this conference call may be forward-looking statements based on current management expectations, and also something that relates to future expected business developments by JK Lakshmi Cement's management. Such statements are subject to a number of risks, uncertainties, and other important factors which may cause the actual developments and results to differ materially from any management predictions made on this call.

Vaibhav Agarwal: Thank you, Ryan. Good evening, everyone. On behalf of PhillipCapital India Private Limited, we welcome you to the Q1 FY 2027 call of JK Lakshmi Cement Limited. On the call from JK Lakshmi Cement, we have with us Mr. Arun Shukla, President and Director, and Mr. Sudhir Bidkar, Executive Directors, Corporate Affairs, and CFO of the company. I would like to mention on behalf of JK Lakshmi Cement Limited and its management that certain statements that may be made or discussed on this conference call may be forward-looking statements based on current management expectations, and also something that relates to future expected business developments by JK Lakshmi Cement's management. Such statements are subject to a number of risks, uncertainties, and other important factors which may cause the actual developments and results to differ materially from any management predictions made on this call.

Speaker #2: On the call from JK Lakshmi Cement, we have with us Mr. Arun Shukla, President and Director, and Mr. Sudhir Butkar, Executive Director – Corporate Affairs and CFO of the company.

Speaker #2: I would like to mention, on behalf of JK Lakshmi Cement Limited and its management, that certain statements that may be made or discussed on this conference call may be forward-looking statements based on current management expectations, and may also relate to future expected business developments by JK Lakshmi Cement's management.

Speaker #2: Such statements are subject to a number of risks, uncertainties, and other important factors which may cause the actual developments and results to differ materially from any management position made on this call.

Speaker #2: JK Lakshmi Cement Limited and the management of the company assume no obligation to publicly update or alter these forward-looking statements, whether as a result of new business developments, information, future events, or otherwise.

Vaibhav Agarwal: JK Lakshmi Cement Limited and the management of the company assumes no obligation to publicly update or alter these forward-looking statements, whether as a result of new business development, information, or future events, or otherwise. The participants of the call can download a copy of the Q1 FY27 results presentation from the company website. I'll now hand over the call to the floor of JK Lakshmi Cement management for their opening remarks, which will be followed by interactive Q&A. Thank you, and over to you, sir.

Vaibhav Agarwal: JK Lakshmi Cement Limited and the management of the company assumes no obligation to publicly update or alter these forward-looking statements, whether as a result of new business development, information, or future events, or otherwise. The participants of the call can download a copy of the Q1 FY 2027 results presentation from the company website. I'll now hand over the call to the floor of JK Lakshmi Cement management for their opening remarks, which will be followed by interactive Q&A. Thank you, and over to you, sir.

Speaker #2: Also, the participants of the call can download a copy of the Q1 FY27 results presentation from the company website. I will now hand over the call to the management of JK Lakshmi Cement for their opening remarks, which will be followed by the Q&A session.

Speaker #2: Thank you, and over to you, sir.

Speaker #3: Yeah, thanks, Vaibhava. Good afternoon. Good afternoon to all of you. Thanks for joining this call of JK Lakshmi Cement, where we are going to discuss the quarter one results.

Arun Kumar Shukla: Yeah. Thanks, Vaibhav. Good afternoon to all of you. Thanks for joining this call of JK Lakshmi Cement, which we are going to discuss Q1 result. Before we take questions, I'll just give you a brief update, though we have already uploaded our result and also the parameter. Still, I think a couple of things which is important to note here. One, of course, I think if you really look at demand side, Q1 FY27 was reasonably all right despite having a lot of issues externally, and one of them was geopolitical situation which we are in. Despite that, I think the demand was better. Industry has grown by about 58% or so. Supply side, around 11 million tons has been added. That is what I think information which we have.

Arun Kumar Shukla: Yeah. Thanks, Vaibhav. Good afternoon to all of you. Thanks for joining this call of JK Lakshmi Cement, which we are going to discuss Q1 result. Before we take questions, I'll just give you a brief update, though we have already uploaded our result and also the parameter. Still, I think a couple of things which is important to note here. One, of course, I think if you really look at demand side, Q1 FY 2027 was reasonably all right despite having a lot of issues externally, and one of them was geopolitical situation which we are in. Despite that, I think the demand was better. Industry has grown by about 58% or so. Supply side, around 11 million tons has been added. That is what I think information which we have.

Speaker #3: So before we take questions, I'll just give you a brief update. Though we have already uploaded our results and also all the parameters, still I think a couple of things are important to note here.

Speaker #3: One, of course, I think if you really look at, you know, demand-side, Q1 FY27 was reasonably all right despite having a lot of issues externally, and one of them was, you know, the geopolitical situation which we are in.

Speaker #3: Despite that, I think demand was better. Industry has grown by about 8% or so. On the supply side, around 11 million tons has been added. That is the information which we have.

Speaker #3: And overall addition is going to be about, you know, 52 million tons as per the estimation which we have with us. Overall installed capacity of cement in India after 11 million ton addition is about 725 million tons.

Arun Kumar Shukla: Overall addition is going to be about 52 million tons as per the estimates which we have with us. Overall installed capacity of cement in India after 11 million tons addition is about 725 million tons. Capacity utilization last quarter industry level was on an average about 73% to 74%. A couple of players higher than that and some of them were lower than that. This is on supply side. If you look at cost side of it, all of us know that cement industry is being impacted by geopolitical situation, which is existing in different parts of the world and the major being Middle East conflict which is happening. That has disrupted the entire supply chain, and the impact of that is on the import which we do, particularly fuel from outside and coal and petcoke.

Speaker #3: Capacity utilization last quarter at the industry level was, on average, about 73% to 74%. A couple of players were higher than that, and some of them were lower than that.

Speaker #3: This is on supply side. If you look at, you know, cost side of it, all of us know that cement industry is being impacted by geopolitical situation which is existing in different part of the world and the major being Middle East conflict which is happening.

Speaker #3: That has disrupted the entire supply chain, and the impact of that is on imports which we do, particularly fuel from outside, and coal and petcoke. So, those players who are there in the northern part of India, I think they were dependent more on imported coal and petcoke.

Arun Kumar Shukla: Those players who are there in the southern part of India, I think they were dependent more on imported coal and petcoke. That has impacted our cost part of it. Even related other products also because of geopolitical situation, be it explosives, chemicals, and other things also, prices have gone up. If you look at the price side of it, price increase has happened but not to the extent cost has gone up. Pass-through has happened partially, and in our market where we operate, non-trade prices have gone up. Trade largely was kind of flat. In some of the market, even trade also improved a bit. Overall, pass-through has not happened to the extent cost has gone up. Internally, JK Lakshmi Cement, we have been working on various ways to mitigate this external situation by working on different levers which we have within our control.

Speaker #3: So that has impacted our cost part of it. Even the, you know, related other products also—because of the geopolitical situation, be it explosives, chemicals, or other things—also, prices have gone up.

Speaker #3: If you look at the price side of it, price increases have happened, but not to the extent that costs have gone up. Pass-through has happened partially, and in our market where we operate, non-trade prices have gone up.

Speaker #3: Trade largely was kind of, you know, flat in some of the markets. Even trade also improved a bit, but overall pass-through has not happened to the extent cost has gone up.

Speaker #3: Internally, JK Lakshmi Cement, we have been working on various ways to mitigate this external situation. By working on different levers, which we have within our control and of course how we can really readjust to the reality of, you know, fuel situation or energy situation which is existing.

Arun Kumar Shukla: Of course, how we can really readjust to the reality of fuel situation or energy situation which is existing. How we can use, let's say, a little more of indigenous coal and replace petcoke which was getting. Similarly on renewable energy front, on the logistics front, and even on top-line elements like volume, premium product, geo mix, and all. Which I have been kind of telling all of you that this is what our focus is. We focus internally and externally wherever we can mitigate with our internal action. That is what we have been doing in the last quarter. This is what just a brief. This is kind of an uncertainty in terms of cost landscape and particularly on fuel part of it.

Speaker #3: How we can use, let's say, a little more of indigenous coal and replace, you know, petcoke, which was getting— which was getting… and similarly, you know, on the renewable energy front, if on logistics front and even on top-line, you know, elements like volume, premium product, geomix and all.

Speaker #3: So, which I have been kind of sure telling all of you, that this is what our focus is. We focus internally and externally, wherever we can mitigate with our internal action.

Speaker #3: That is what we have been doing in the last quarter. So this is just a brief. This is the kind of uncertainty in terms of the cost landscape, and particularly on the fuel part of it.

Speaker #3: Now we are through this, you know, cyclicity. So, of course, I think this is going to be a kind of, you know, double impact this quarter.

Arun Kumar Shukla: Now we are through this cyclicity, of course, I think this is going to be a kind of double impact this quarter. One is on our leverage part of it, and second, cost impact, it is going to be a little more in Q2 than what it was before. This is what is there from my end as of now. Now this is open for question and answer from you.

Speaker #3: One is, you know, the leverage part of it, and second, the cost impact, which is going to be a little more in Q2 than what it was before.

Speaker #3: So this is what is there from my end as of now. Now, this is open for question and answer from you.

Speaker #1: Yeah. Before we take up the question answers and throw the floor open, I would like to make a mention that you would all investors would know that we had an AGM last week and in which we had proposed various resolutions.

Sudhir Bidkar: Yes. Before we take up the question answers and throw the floor open, I would like to make a mention that you would all, investors would know that we had an AGM last week, in which we had proposed various resolutions. Unfortunately, despite the fact that all these resolutions were in full compliance of the law and as per the SEBI LODR guidelines, the proxy advisors had proposed a negative voting for some of the resolutions. Some of the investors, just based on the negative recommendation of the proxy advisor, had casted a negative vote on some of the resolutions. Fortunately for us, very many mutual funds and FIIs took a pragmatic view based on the representation made by the company to these proxy advisors. Though they issued the addendum attaching the company's response to their recommendation, they did not change their recommendation.

Sudhir Anna Bidkar: Yes. Before we take up the question answers and throw the floor open, I would like to make a mention that you would all, investors would know that we had an AGM last week, in which we had proposed various resolutions. Unfortunately, despite the fact that all these resolutions were in full compliance of the law and as per the SEBI LODR guidelines, the proxy advisors had proposed a negative voting for some of the resolutions. Some of the investors, just based on the negative recommendation of the proxy advisor, had casted a negative vote on some of the resolutions. Fortunately for us, very many mutual funds and FIIs took a pragmatic view based on the representation made by the company to these proxy advisors. Though they issued the addendum attaching the company's response to their recommendation, they did not change their recommendation.

Speaker #1: And unfortunately, despite the fact that all these resolutions were in full compliance with the law and as per, say, the LODR guidelines, the proxy advisors had proposed a negative voting for some of the resolutions.

Speaker #1: And some of the investors, just based on the negative recommendation of the proxy advisor, had cast a negative vote on some of the resolutions.

Speaker #1: Fortunately for us, very many mutual funds and FIIs took a pragmatic view based on the representation made by the company to these proxy advisors.

Speaker #1: Though they issued the addendum, attaching the company's response to their recommendation, they did not change their recommendation. And you would be surprised that even the re-election of the professional director, Mr. Shukla, was recommended to be negatively voted by some international proxy advisors.

Sudhir Bidkar: You would be surprised that even the re-election of the professional director, Mr. Shukla, was recommended to be negatively voted by some international proxy advisors. Fortunately for us, as I mentioned, very many mutual funds and FIIs took a pragmatic view and casted the vote in favor of these resolutions. All these resolutions were passed with overwhelming majority and whatever majority was required to be passed to get these resolutions through. We expect our investors take a pragmatic view in the matters, discuss the matter with the company, and take a conscious view rather than just basing it on the recommendations of the proxy advisors. That is the opening comment I wanted to make, and we can now throw the floor open for question answers, please.

Sudhir Anna Bidkar: You would be surprised that even the re-election of the professional director, Mr. Shukla, was recommended to be negatively voted by some international proxy advisors. Fortunately for us, as I mentioned, very many mutual funds and FIIs took a pragmatic view and casted the vote in favor of these resolutions. All these resolutions were passed with overwhelming majority and whatever majority was required to be passed to get these resolutions through. We expect our investors take a pragmatic view in the matters, discuss the matter with the company, and take a conscious view rather than just basing it on the recommendations of the proxy advisors. That is the opening comment I wanted to make, and we can now throw the floor open for question answers, please.

Speaker #1: Fortunately for us, as I mentioned, very many mutual funds and FIIs took a pragmatic view and cast their vote in favor. These were passed with overwhelming majority and whatever majority was required to be passed to get these resolutions through.

Speaker #1: So we expect our investors to take a pragmatic view in these matters, discuss the matter with the company, and take a conscious view rather than just basing it on the recommendations of the proxy advisors.

Speaker #1: That is the opening comment I wanted to make. We can now throw the floor open for questions and answers, please.

Speaker #2: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone.

Operator: Thank you. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use their handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We take the first question from the line of Sanjeev Kumar Singh from Motilal Oswal Financial Services. Please go ahead.

Speaker #2: If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use their handsets while asking a question.

Speaker #2: Ladies and gentlemen, we will wait for a moment while the question queue assembles. We will take the first question from the line of Sanjeev Kumar Singh from Motilal Oswal Financial Services.

Speaker #2: Please go ahead.

Speaker #4: Thank you for the opportunity, sir. My first question is on realization. As you mentioned, trade prices did not move up materially, but there was some improvement in non-trade prices.

Sanjeev Kumar Singh: Thank you for the opportunity, sir. My first question is on realization. As you mentioned that trade prices did not move up materially. There was some improvement in non-trade prices. Overall, your realization seems to be up by around 9% on a sequential basis. What is this related to? Is this related to some sort of market mix, some sort of product mix? Can you throw some light on this?

Speaker #4: But overall, your realization seems to be up by around 9% on a sequential basis. So, what is this related to? Is this related to some sort of market mix, or some sort of product mix?

Speaker #4: Can you shed some light on this?

Speaker #3: Yeah. So, non-trade prices went up in some markets, and even, you know, trade prices also went up in a few markets—not lower markets. But the major increase was there in non-trade.

Arun Kumar Shukla: Yeah. Non-trade prices went up in some markets, and even trade prices also went up in few markets, not all markets. Major increase was there in non-trade, so that has helped us. The major impact has come about through our focus in geo mix. The material where we are going to sell, and that has impacted our realization a bit. One, of course, non-trade, because we are a little heavy on non-trade, you know that. Even last Q also, 41% is our non-trade. Non-trade price increase in markets like Gujarat and Mumbai area, even East also it went up, and North as well. Trade was kind of stable in North, went up a bit in the West, and also in East. That has helped us to improve our realization. Geo mix and the price increases which we had.

Speaker #3: So that has helped us. But the major impact has come about through our, you know, focus in geomics. The material where we are going to sell, and that has impacted our realization a bit.

Speaker #3: So, one, of course, non-trade, because we are a little heavy on non-trade—you know that. Even last quarter, non-trade was 41%, right?

Speaker #3: So non-trade price increase and markets like Gujarat, and Mumbai area even east also it went up and north as well. Trade was kind of, you know, stable in north.

Speaker #3: Went up a bit in West, and also in East. So that has helped us to improve our realization. So geographics and the price increases which we had, and of course, I think other levers which we keep on working on.

Arun Kumar Shukla: Of course, I think other levers, which we keep on working on. For instance, if you really look at our lead has gone down by 20 km last Q. Combination of all these parameters has helped us to improve our lead.

Speaker #3: So for instance like if you really look at in our lead lead has, you know, gone down by 20 kilometers last quarter. All these, you know, combination of all these parameters has helped us to improve our activities.

Speaker #4: So sir, would it be possible to share some more color on the geographies change—like in which markets you are seeing some improvement in your volumes, or where have you reduced your volume?

Sanjeev Kumar Singh: Would it be possible to share some more color for the geo mix change? Like in which markets you have seen some improvement in your volumes, or where have you reduced your volume?

Speaker #3: No, so I think that is evident because if my lead is going down by 20 kilometers, then my sales have increased in the nearby area.

Arun Kumar Shukla: No. I think that is evident because if my lead is going down by 20 km, my sales have increased in nearby areas. I think I do not have that breakup geography-wise as to where we have sold how much. Yes, of course, I think far-off market, we have reduced quite a bit in the last Q.

Speaker #3: I think I do not have that, you know, breakup geography-wise as to where we have sold how much. But yes, of course, I think far-off market we have reduced quite a bit in the last quarter.

Speaker #4: Okay. And second question is on your variable cost. So this also looks higher than what peers have reported. So can you give some information on per Kcal cost in terms of fuel in this quarter versus what it was in Q4, and currently, what is it as of now?

Sanjeev Kumar Singh: Okay. Second question is on your variable cost. This also looks higher than what peers have reported. Also, can you give some information on per kiloCal cost in terms of fuel in this quarter versus what was in Q2, and currently what is it as of now?

Speaker #3: Yeah. So last quarter, fuel cost was 1.65, which went up from 1.54 the preceding quarter. So, there is an increase of about, you know, 11 paisa.

Arun Kumar Shukla: Yes. Last quarter, fuel cost was 1.65, which went up from 1.54 preceding quarter. There is an increase of about 11 paisa. That is one of the major elements. I think fuel per kiloCal increase is one of the major contributors to it.

Speaker #3: So, that is one of the major elements, I think. Fuel, you know, per kilocalorie increase is one of the major contributors too.

Speaker #4: And what is it currently, sir, in this quarter, in Q2?

Sanjeev Kumar Singh: What is it currently, sir, in this quarter, in Q2?

Speaker #3: So, quarter two, I think, we have just, you know, closed one quarter. So, it is going up for sure. I think it's more than—it's one point more than 1.65.

Arun Kumar Shukla: Q2, I think we have just closed one quarter, it is going up for sure. I think it's more than 1.65.

Speaker #4: Okay, thank you. I will come back in the queue.

Sanjeev Kumar Singh: Okay, sir. Thank you. I will come back in the queue.

Speaker #3: Yeah. Thank you.

Arun Kumar Shukla: Yeah. Thank you.

Speaker #2: Thank you. To ask a question, please press star and one. We will take the next question from the line of Amit Murakka from Axis Capital.

Operator: Thank you. To ask a question, please press star and one. We take the next question from the line of Amit Murarka from Axis Capital. Please go ahead.

Speaker #2: Please go ahead.

Amit Murarka: Hi, good evening. Thanks for the opportunity. Could you share the number of other operating income which you had in the quarter?

Speaker #5: Hi, good evening, and thanks for the opportunity. Could you share the number for other operating income that you had in the quarter?

Arun Kumar Shukla: Other operating income. Not much. No, other operating income is basically other income which we have shown separately. Other income, not the other operating income. It is the income from the strategic

Speaker #3: Other operating income? Yeah. Everyone... No, not much. No, the other operating income is basically 'other,' which we have shown separately. Other income, not the other operating income.

Speaker #3: It is the income from the strategy.

Speaker #4: Strategy.

Speaker #5: Yeah. You know, other income—I know it's there in the results. But there are other, so, other kinds of non-operating, non-revenue-related operating incomes also, right?

Amit Murarka: Yeah, other income, I know it's there in the results. There are also other kind of non-revenue-related operating incomes also, right? It's booked in revenue.

Speaker #5: It's a books and revenue.

Speaker #3: Other operating income—we don't have any other non-operating income.

Arun Kumar Shukla: Other operating income. We don't have any other non-operating income.

Speaker #5: Okay, sure. So then, on this price improvement of, like, 89%—I understand that you say it is due to geomix optimization—but could you still explain what are the markets where, let's say, you sold more? Because this is a really meaningful increase, as you would also agree.

Amit Murarka: Okay. Sure. On this price improvement of 8%, 9%, I understand that you say that it is geo mix optimization, but could you still explain what are the markets where, let's say, you sold more? This is a really meaningful increase, as you would also agree. Just to kind of better understand.

Speaker #5: So just to better understand.

Speaker #3: Yeah, so major, I think we have, you know, four major markets where we sell—Gujarat, Rajasthan, Chhattisgarh, and Haryana, and part of western UP.

Arun Kumar Shukla: Yeah. I think we have four major markets where we sell. Gujarat, Rajasthan, Chhattisgarh, and Haryana, and part of Western UP. Just to give you a sense, we have sold about close to 90% sales in these markets.

Speaker #3: So just to give you a sense, we have sold about, you know, close to 90% of our sales in these markets.

Speaker #5: Okay. And last quarter, what was the number for that?

Amit Murarka: Okay.

Arun Kumar Shukla: Yeah.

Amit Murarka: Last quarter, what was the number for that?

Speaker #3: Sorry?

Arun Kumar Shukla: Sorry?

Speaker #5: Was that number lower last quarter, as in for Q4?

Amit Murarka: Last quarter, was that number lower as in for Q4?

Speaker #3: Yeah, yeah. Of course, lower. Of course, lower. And it must be about, you know, at least, you know, 10% lower than this. And that has impacted our lead also.

Arun Kumar Shukla: Yeah. Of course lower. Must be about at least 10% lower than this. That has impacted our lead also. If you look at our lead, it has gone down from 388 to 368.

Speaker #3: If you look at our lead, you know, it has gone down from 388 to 368.

Speaker #5: Okay. Okay. Understood. And how much Capex has been spent on those expansions so far?

Amit Murarka: Okay. Understood. How much CapEx has been spent on those expansions so far?

Speaker #3: In this quarter, we have spent about ₹2,300 crores in this three-month period. And if you want to know separately how much has been spent on Durg only for that expansion, it is about ₹400 crores.

Arun Kumar Shukla: Total in this quarter, we have spent about INR 300 crores in this three-month period. If you want to know separately on how much has been spent on Durg only for that expansion, is about INR 400.

Amit Murarka: INR 400 in aggregate so far, you mean?

Speaker #5: You mean 400 in aggregate so far?

Speaker #3: Yeah. 400 is aggregate, in so far as it includes what has been spent in the previous year. The total for FY27, in the 12-month period, we expect a total capex of about ₹1,500 crores.

Arun Kumar Shukla: Yeah, INR 400 is aggregate in so far, including what has been spent in the previous year. Total for FY27 in 12 months period, we expect a total CapEx of about INR 1,500 crores. Then after next year, slightly higher at INR 2,000 crores, then again INR 1,500. This is without taking into account the expenditure to be incurred on land acquisitions for Kutch and Nagaur, which is slightly going slow. That is what guidance for as of now is.

Speaker #3: And thereafter, next year, slightly higher at ₹2,000 crore, and then again ₹1,500 crore. This is without taking into account the expenditure to be incurred on land acquisitions for Kutch and Nagor, which is slightly going slow.

Speaker #3: So that is what the guidance is for as of now.

Speaker #5: Right. So this guidance includes the Northeast expansion also?

Amit Murarka: Right. This guidance includes the Northeast expansion also?

Speaker #3: Yeah, Northeast—this does include Northeast also. Of ₹1,500 crores.

Arun Kumar Shukla: Yeah, Northeast. This does include Northeast also of INR 1,500 crores.

Speaker #5: Understood. Also, could you share the number for the non-cement revenue in the quarter?

Amit Murarka: Understood. Also, could you share the number for the non-cement revenue in the quarter?

Speaker #3: Non-cement revenue in this quarter was ₹185 crores. Yeah. Yeah. ₹185 crores.

Arun Kumar Shukla: Non-cement revenue in this quarter was

Rajesh Kumar Ravi: INR 185.

Arun Kumar Shukla: Yeah, INR 185 crores.

Speaker #5: Okay.

Amit Murarka: Okay.

Speaker #3: It's included. RMC of ₹93 crores and other products—ASC ₹67 crores, POP ₹23 crores. That is how the ₹185 crores is made up.

Arun Kumar Shukla: INR 185. This includes RMC of INR 93 crores and other products AAC INR 67 crores, BOP INR 23 crores. That is what was made up of INR 185 crores.

Speaker #5: Got it. And while you said fuel cost will increase a bit in Q2, is there any other area of cost inflation which will be there?

Amit Murarka: Got it. While fuel cost, you said, will increase a bit in Q2, is there any other area of cost inflation which will be there? I believe packaging would be moderating now.

Speaker #5: I believe packaging would be moderating now, correct?

Speaker #3: No, no. Packaging cost also—the recent trend is, you know, granule prices have gone up. I was just kind of, you know, looking at it.

Arun Kumar Shukla: No. Packaging cost also, the recent trend is now the granule prices have gone up. I was just kind of looking at it. It went down a little bit, 134 or something. Now it has gone up to 145. That is also going up, and the impact of that to my calculation, Indian steel calculation is about, on bag itself is about three and a half to INR 4 per bag.

Speaker #3: It went down a little bit, you know, to 134 or something. Now it has gone up to 145, so that is also going up.

Speaker #3: And the impact of that, you know, to my calculation in initial calculation, is about, on bag itself, is about, you know, three-and-a-half to four rupees per bag.

Speaker #5: Over and above Q1, you mean?

Amit Murarka: Over and above Q1, you mean?

Speaker #3: Yes, yes. Because this is recent, you know, so this cost has gone up. Bag packing cost is going up. Now Pet Coke was kind of softening a little bit in between, but it has gone up once again.

Arun Kumar Shukla: Yes. Because this is the recent. This cost has gone up, packing cost is going up. Now, pet coke was kind of softening a bit, little bit in between, but it has gone up, shot up once again. It's gone up more than 140, 145 now. Same goes with imported coal, also about $130, $135 per ton.

Speaker #3: It's gone up more than, you know, 140, 145 now. And same goes with, you know, imported coal, also about 130, 135 dollars per ton.

Speaker #5: Gotcha. Okay. Understood.

Amit Murarka: Okay. Understood.

Speaker #3: Yes. Cost is constant. It has not gone up with respect to last quarter, but fuel cost, packing cost—this is definitely, I think, an increasing trend now.

Arun Kumar Shukla: Yes. It is constant. It has not gone up with respect to last quarter. Fuel cost, packing cost, this is definitely, I think, is on increasing trend now.

Speaker #5: Correct. So.

Amit Murarka: Correct.

Speaker #3: Again, if, you know, something happens—something positive externally—then I think things may improve. But this is what it is as of today.

Arun Kumar Shukla: If something happens, something positive externally, then I think things may improve. This is what it is as of today.

Speaker #5: Sure. So, would you be able to share a number, let's say for cost inflation for Q2, then in aggregate, as in on a per ton basis?

Amit Murarka: Sure. Would you be able to share a number, let's say, for cost inflation for Q2 then in aggregate, as in percentages?

Speaker #3: I think the major contributor is going to be fuel cost. So, from 1.65 to maybe touching even about 1.8 or even 1.85 times.

Arun Kumar Shukla: I think, see, major contributor is going to be fuel cost. From 1.65 to maybe even touch even above 1.8 plus or even 1.85 times.

Speaker #5: Understood, understood. Got it. And just a last data question also—on the non-cement business, what would be the EBITDA margin in the quarter?

Amit Murarka: Understood. Got it. Just a large data question also. On the non-cement business, what would be the EBITDA margin in the quarter?

Speaker #3: 5%.

Arun Kumar Shukla: 5%.

Speaker #5: Sure. Okay, that's it from me. Thank you.

Amit Murarka: Okay. That is it for me. Thank you.

Speaker #2: Thank you. Press star and one to ask a question. We will take the next question from the line of Rajesh Ravi from HDFC Securities. Please go ahead.

Operator: Thank you. Press star and one to ask a question. We take the next question from the line of Rajesh Ravi from HDFC Securities. Please go ahead.

Rajesh Kumar Ravi: Hello.

Speaker #5: Hello.

Speaker #3: Yeah. Rajesh ji. Good afternoon.

Arun Kumar Shukla: Yes, Rajesh, good afternoon.

Speaker #5: Hi, sir. Good evening. Hi, sir. Good evening. So, first, starting with, what was the clinker sales volume in Q1 out of this 35.98 lakhs?

Rajesh Kumar Ravi: Hi, sir. Good evening. First, starting with what was the clinker sales volume in Q1 out of this 35.98 lakhs?

Speaker #3: Yeah. Yes. Hold on and I’ll let you know.

Arun Kumar Shukla: Yes, hold on. I'll let you know.

Speaker #5: 1.66.

Rajesh Kumar Ravi: 1.63.

Speaker #3: 1.6 lakhs and right?

Arun Kumar Shukla: 1.6 lakhs something?

Speaker #5: 63 lakhs.

Rajesh Kumar Ravi: 63.

Speaker #3: 1.63.

Arun Kumar Shukla: 1.63.

Speaker #5: 1.63 lakhs. Okay. So there is a fall in the clinker sales volume quarter-on-quarter. Is this understanding correct?

Rajesh Kumar Ravi: 1.63 lakhs. Okay. There is a fall in the clinker sales volume quarter on quarter. Is this understanding correct?

Speaker #3: Yes. Yeah. Yeah. Absolutely.

Arun Kumar Shukla: Yeah, absolutely.

Speaker #5: Okay. And second, on the reported cement realization, which you shared, that number is up by almost Rs 20 per bag quarter-on-quarter. You mentioned that trade sales' trade realization barely moved, and non-trade would have improved.

Rajesh Kumar Ravi: Second, the reported cement realization which you share, that number is up by almost INR 20 per bag, quarter-on-quarter. You mentioned that trade sales, trade realization barely moved, and non-trade would have improved. There is a sharp INR 20 increase.

Speaker #5: So this is a sharp 20-rupee increase. So even, you know, would you?

Speaker #3: Yeah. Go ahead.

Arun Kumar Shukla: Yeah, go ahead.

Speaker #5: Yeah. So on a like-to-like basis, what was the price improvement seen in the trade and non-trade segments? I just want to split the benefit, you know, on account of price movement and on account of geographics optimization.

Rajesh Kumar Ravi: On a like-to-like basis, what was the price improvement seen in the trade and non-trade segments? I just want to split the benefit on account of price movement and on account of geomix optimization.

Speaker #3: So I do not have a granular, you know, figure, but I'll just let you know. So, based on geonomics, the reduction is about 20 kilometers per bag, which translates to about, you know, 60–70 rupees.

Arun Kumar Shukla: I do not have granular figure. I'll just let you know. Based on geomix, the reduction is about 20 kilometers. That translates to about INR 60, INR 70 per ton. Right? Rest is your price increase. See, if you really look at west prices like Gujarat and even Mumbai where we sell little bit, and our non-trade proportion is very high. Their prices went up and that has helped us.

Speaker #3: Per ton, right? And the rest is your, you know, price increase. And if you really look at, you know, West prices, like Gujarat and, you know, even Mumbai, where we sell a little bit, and our non-trade proportion is very high.

Speaker #3: Their prices went up, and that has helped us.

Speaker #5: Okay. Okay. Understood.

Rajesh Kumar Ravi: Okay. Understood.

Speaker #3: Trade prices went up in the East, so that has helped us. North was almost kind of, you know, constant—a little bit here and there, not much. But non-trade, even in North, also has gone up.

Arun Kumar Shukla: Trade prices went up in the east, so that has helped us. North was almost kind of constant, a little bit here and there, not much. Non-trade even north also has gone up.

Speaker #5: Mm-hmm. Understood. So, if I look at your use, you have mentioned in the presentation that your lead distances have come off. But if I look at the freight cost, that number has inched up by ₹30 per ton.

Rajesh Kumar Ravi: Understood. If I look at your, you have mentioned in the presentation that your lead distance has come off. If I look at the freight cost, that number has inched up by INR 30 per ton. Obviously, there would be some impact of diesel price increase for a month. We haven't seen the benefit of the lead distance in the freight cost.

Speaker #5: Obviously, there would be some impact from the diesel price increase for a month, but we haven't seen the benefit of the lead distance in the freight cost.

Speaker #3: Yeah, so we kind of hold on to freight for some time, but you know, in certain routes, certain lanes, we had to increase this because, you know, diesel prices went up.

Arun Kumar Shukla: Yeah. We kind of held on to freight for some time. In certain routes, certain lanes, we had to increase this because of diesel prices went up. Right? The reduction has been much more than what inflation we gave in terms of freight. Okay.

Speaker #3: Right? But the reduction has been much more than what, you know, inflation we gave in terms of, you know, freight. Okay?

Speaker #5: So, they didn't understand the last part?

Rajesh Kumar Ravi: Sorry, didn't understand the last part.

Speaker #3: So, the reduction which we have taken—20 kilometers—they said surpasses the, you know, cost inflation of the freight increase which we had given to our transporters.

Arun Kumar Shukla: The reduction which we have taken 20 kilometers-

Arun Kumar Shukla: is then surpass the cost inflation of the freight increase which we had given to our transporters. That is what I'm trying to tell you.

Speaker #3: That is what I'm trying to tell you.

Speaker #5: Okay. So you're saying that your freight operators have taken a larger increase, but that impact is moderated because of the lead distance reduction which you have seen.

Rajesh Kumar Ravi: Okay. You're saying that your freight operators have taken a larger increase, but that impact is moderated because of the lead distance reduction which you have seen. Were there any maintenance shutdowns across plant which would have inflated the other expense numbers in this quarter? Because even that is at very high, at INR 770 per ton.

Speaker #5: And were there any maintenance shutdowns at all across the plant which would have inflated the other expense numbers in this quarter? Because even that is very high at ₹770 per ton.

Speaker #3: Yeah. So no. No. No. So we we we had no. We took you know maintenance also in some of the cases. Like you know so there were some maintenance part not major because major you know maintenance is happening annual shutdown this quarter.

Arun Kumar Shukla: Yeah. No. Packing cost went up. Huh? Packing cost. Packing cost went up. That was the-

Rajesh Kumar Ravi: Right.

Arun Kumar Shukla: No. We took maintenance also in some of the plants.

Arun Kumar Shukla: There were some maintenance part, not major, because major maintenance is happening, annual shutdown this quarter. Packing cost is one cost which has gone up, right? Some of the plants, I think, we had some shorter shutdown also to kind of work on few things.

Speaker #3: But you know, packing cost is one cost which has gone up, right? And at some of the plants, I think we had some shorter shutdowns also to kind of work on a few things.

Speaker #5: Understood. So now, between Q1 and Q2, you're looking at your fuel cost going up by 20 paisa, which would be like ₹100 per ton.

Rajesh Kumar Ravi: Understood. Now between Q1 and Q2, you're looking at your fuel cost going up by INR 0.20, which would be like INR 100 per ton. Even packaging, you're implying INR 3 to 4 per bag, means around INR 80 increase in packaging cost. Even if I take it further, at least yeah, INR 50 to 60 impact. We are talking about 150+ variable cost increase. Additionally, there will be an op level loss sequentially, also maintenance-related expenditure piling up in Q2. Obviously, cement prices haven't moved up. Rather, they would have a negative bias versus Q1. Are we looking at margins tapering off significantly in Q2 versus Q1 versus current cement prices?

Speaker #5: And even packaging, you’re implying Rs 3 to 4 per bag, which means around Rs 80 increase in packaging cost. So, you know, even if I take it further, at least, yeah, Rs 50 to 60 impact—we are talking about Rs 150 plus variable cost increase.

Speaker #5: Additionally, there will be an off-label loss sequentially, and also maintenance-related expenditure piling up in Q2. Obviously, cement prices haven't moved up; rather, they would have a negative bias versus Q1.

Speaker #5: So, are we looking at margins tapering off significantly in Q2 versus Q1, based on current cement prices?

Speaker #3: See, typically July to September is cyclical—you know, there's demand cyclicity.

Arun Kumar Shukla: See, typically July, September is cyclical, demand cyclicity.

Speaker #5: Yeah.

Rajesh Kumar Ravi: Correct.

Arun Kumar Shukla: Also all of us take maintenance during this time.

Speaker #3: So all of us, you know, take maintenance during this time, so that definitely impacts our margin, right? Now, as I said before, on the energy front and fuel front, there is an uncertainty.

Arun Kumar Shukla: Also all of us take maintenance during this time.

Rajesh Kumar Ravi: Yes.

Arun Kumar Shukla: That definitely impacts our margin. Right? As I said before, that on energy front, fuel front, there is an uncertainty. If things improve, then I think it's going to be good.

Speaker #3: If things improve, then I think it's going to be good. And also, this is impacting across the industry, so pass-through also definitely will happen.

Arun Kumar Shukla: Also, this is impacting across industry, then pass-through also definitely will happen. That is what I believe. Perhaps is going to kind of hit our margin. We'll try to pass it on to our customers because absorbing this much cost is not possible. I think we'll have to pass it on. The only challenge would be that this is falling or coinciding with demand cyclicity. How much pass-through of that is going to happen, that is a kind of big question mark. How much we'll be able to pass it on. That is what the crux is. Otherwise, definitely pass on will happen and cyclicity will impact. That is something which is kind of every year phenomena.

Speaker #3: That is what I believe. So, is that going to, you know, hit our margin? We'll try to pass it on to our customers.

Speaker #3: Because you know, absorbing this much cost is not possible. I think we'll have to pass it on. The only challenge would be that this is falling, or coinciding with, you know, demand cyclicity.

Arun Kumar Shukla: The only challenge would be that this is falling or coinciding with demand cyclicity. How much pass-through of that is going to happen, that is a kind of big question mark. How much we'll be able to pass it on. That is what the crux is. Otherwise, definitely pass on will happen and cyclicity will impact. That is something which is kind of every year phenomena.

Speaker #3: So how much pass through that is going to happen that is a kind of you know big you know question mark. How much will be able to pass it on?

Speaker #3: So that is what the, you know, crux is. Otherwise, definitely, pass one, pass one will happen, and cyclicity will impact. So that is something which is kind of, you know, an every-year phenomenon.

Speaker #5: Understood. Understood. So, but so far in July and early August, what has been the pricing trend versus the average of Q1?

Rajesh Kumar Ravi: Understood. So far in July and early August, what has been the pricing trend versus average of Q1?

Speaker #3: So, July and August, if you compare, I think I have not seen much of an upward trend, but prices have not gone down either. Right? So, prices have an impact in all markets.

Arun Kumar Shukla: July, August, if you compare, I think I have not seen much upward trend, but prices have not gone down even.

Rajesh Kumar Ravi: Understood. Mm-hmm.

Arun Kumar Shukla: Prices are stacked in all markets till now because we are just 6th of the month of August.

Speaker #3: Till now, because we are just, you know, at the 6th of the month—August—and July has just, you know, passed, so prices have not gone down.

Arun Kumar Shukla: July has just passed. Prices have not gone down. Maybe, I think, if you know that July has been a little wetter than July previous months. Right?

Speaker #3: Maybe, I think, if you know that July has been a little wetter than July of the previous year, right? So, I think demand will improve, or maybe I think a little bit upward movement in demand will definitely help us to take up some price increase also.

Rajesh Kumar Ravi: Understood.

Arun Kumar Shukla: I think demand will improve, or maybe I think a little bit upward in demand will definitely help us to take up some price increase also.

Speaker #5: Understood. And so, lastly on that topic, what is the equipment ordering status on the eastern and central expansions, and on the railway siding phase two, as well as on the conveyor belt in Durg?

Rajesh Kumar Ravi: Understood. Sir, lastly, on the CapEx, what is the equipment ordering status on the eastern and central expansions and on the railway siding phase 2 as well as on the conveyor belt in the Durg?

Speaker #3: So on all ongoing projects major equipment ordering we have already done for instance like Durg our you know second Kalkar 9 plus you know grinding facility plus grinding at you know our Patharatu and Madhubani sorry Prayag Madhubani.

Arun Kumar Shukla: On ongoing projects, major equipment ordering we have already done. For instance, like Durg, our second clinker nine plus grinding facility, plus grinding at our Patratu and Madhubani. Sorry

Arun Kumar Shukla: Prayagraj, Madhubani. That major equipment ordering we have already done.

Speaker #3: So that major equipment ordering, we have already done.

Speaker #5: Okay.

Rajesh Kumar Ravi: Okay.

Speaker #3: And this railway project, which I mentioned before also, is contingent on the kind of collaboration with Steel Authority of India and other stakeholders.

Arun Kumar Shukla: This railway project, which I said before also that is contingent to the kind of collaboration with Steel Authority of India and other stakeholders.

Speaker #3: Right? And even, you know, since we are just passing through some roads, also PWD roads, so I think there has to be a kind of collaborative approach with all those stakeholders also to take it forward.

Arun Kumar Shukla: Right? Even since we are just passing through some road also, PWD road, I think that has to kind of a collaborative efforts with all those stakeholders also to take it forward. That is no way impacting our operations because we are operating our railway line full phase, no issue. Whenever that kind of collaboration happens, then we'll take this railway project forward, whatever is remainder.

Speaker #3: But that is in no way impacting our operations because we are operating our railway line fully, no issue. And whenever that kind of, you know, collaboration happens, then we'll take this railway project forward, whatever is remainder.

Rajesh Kumar Ravi: The overhead conveyor belt project?

Speaker #5: And the overhead conveyor belt project?

Rajesh Kumar Ravi: The overhead conveyor belt project?

Speaker #3: Overhead conveyor belt so as I said that this approval was pending with you know Steel Authority of India Limited. Has been approved now this is proposed agreement is now lying with Steel Authority of India Limited and they have to kind of you know go ahead to do this agreement and contacting.

Arun Kumar Shukla: Overhead conveyor belt, as I said that this approval was pending with Steel Authority of India Limited, has been approved now. Proposed agreement is now lying with Steel Authority of India Limited, they have to go ahead to do this agreement and contracting. We have reached to that level till now.

Speaker #3: So we have reached to that level till now.

Speaker #5: Understood, understood. That's really great. I'll come back in Q&A. Thank you, and all the best.

Rajesh Kumar Ravi: Understood. Sir, that's really great. I'll come back into you. Thank you and all the best.

Speaker #3: Thank you so much. Thank you.

Arun Kumar Shukla: Okay, thank you.

Speaker #1: Thank you. Press start and 1 to ask a question. We take the next question from the line of Girija Ray from Nirmal Bang Securities.

Operator: Thank you. Press star and one to ask a question. We take the next question from the line of Girija Ray from Nirmal Bang Securities. Please go ahead.

Speaker #1: Please go ahead.

Speaker #5: Hello, sir. Good evening. Thank you for this opportunity. I have a few questions, and the first is a number-related question. What is our total formal capacity, and if you can, please provide me with the RE component installed capacity as of today?

Girija Shankar Ray: Hello, sir. Good evening. Thanks for this opportunity. I have few questions. One number-related question that is first. What is our total formal capacity, and if you can provide me RE component installed capacity as of today. What is our progress towards increase of RE capacity and for power and fuel cost savings purpose? This is my first question.

Speaker #5: And what is our progress towards increasing RE capacity, and for power and cost savings? This is my first question.

Speaker #3: Okay. So you also right last quarter we have renewable energy 49% right? So whatever energy we consume 49% is our renewable energy and that includes solar, wind, and WHR.

Arun Kumar Shukla: Okay. You are so right. Last quarter, we have renewable energy 49%, right? Whatever energy we consume, 49% is our renewable energy, and that includes solar, wind, and WHRS. This is in terms of our renewable energy, 49%. Of course, I told you that our plan is to take it up. We are working on some other projects also, and going forward, maybe six months, eight months down the line, we'll further improve this percentage. This is part one of your question, right? Part two was what? Just I'm listening to the.

Speaker #3: Right? So this is in terms of our reliable energy—49%. And of course, I told you that our plan is to take it up.

Speaker #3: We are working on some other projects also, and going forward, maybe six to eight months down the line, we'll further improve this percentage.

Speaker #3: So this is part one of your question, right? Part two was what? I’m just missing that.

Speaker #5: Wanted to know the thermal capacity and renewable component capacity, like solar, wind, and WHRs. Installed capacity.

Girija Shankar Ray: Wanted to know. No. Thermal capacity and renewable component capacity like solar, wind, and WHRS. Installed capacity.

Speaker #3: Yeah. So I think I can give you that breakup, right? So, solar is 129 megawatt, WHRS is 45 megawatt, and wind is 4 megawatt.

Arun Kumar Shukla: Yeah. I can give you that breakup. Right. Solar is 129 MW, WHRS is 45 MW, and wind is 4 MW.

Girija Shankar Ray: The thermal capacity?

Speaker #5: And the thermal thermal capacity?

Girija Shankar Ray: The thermal capacity?

Speaker #3: 74 megawatt.

Arun Kumar Shukla: 74 MW.

Speaker #5: Okay. Okay. Coming back to my second question, if we talk about the regional pricing—right now, if we see North and East, generally these prices are very high; cement price, I can say.

Girija Shankar Ray: Okay. Coming back to my second question. See, if we talk about the regional pricing, right now, if we see North and East, generally these prices are very high, cement prices, I can say, right, as compared to other regions. If in case there is a price hike across geography, do you think that we still have some kind of potential of a price hike? In fact, in a different way, if we see, if there is a price correction, there might be a significant chance of that, the North and East can impact much rather than other regional prices. How to see when already we are in a very high price in North and East regions. Please correct me if I'm wrong or just give me some view of yours.

Speaker #5: Right? As compared to other regions.

Speaker #3: So, in case there is a price hike across the geography, do you think that we still have some kind of potential for a price hike?

Speaker #3: In fact, in a, you know, different way, if we see, if there is a price correction, there might be, you know, significant chances that, you know, the North and East can impact much.

Speaker #3: Rather than other regional prices. So, how do you see—like, you know, already we are at a very high price in the North and East regions.

Speaker #3: So if I'm please correct me if I'm wrong or just give me some view of yours. I have a different view. I I don't know where from you're coming.

Arun Kumar Shukla: I have a different view. I don't know where from you are coming prices are high, because North cost is also the highest. As I told you, in one of our investors, they were asking impact of these geopolitical situation. I explained in my opening remark also, that North has been impacted the most because we were importing coal and petcoke. Right?

Speaker #3: Prices are high, because North Coast is also the highest. And as I told you, you know, one of our investors was asking about the impact of this geopolitical situation.

Speaker #3: I explained in my opening remarks also that the North has been impacted the most because we were importing, you know, coal and petrol. Right? So, to my mind, I think, you know, PASU has not happened in the North.

Girija Shankar Ray: Yes.

Arun Kumar Shukla: To my mind, I think pass-through has not happened in North. North has a better headroom to increase prices than other zones. This is what my take is, which is little different than your understanding.

Speaker #3: So, North has better headroom to increase prices than other zones. So, that is what my take is, which is a little different than your understanding.

Speaker #5: Okay.

Girija Shankar Ray: Okay.

Speaker #3: Second is, if you look at, you know, the lowest price perhaps, which is existing in entire India, it is the eastern part of India, and particularly in Chhattisgarh.

Arun Kumar Shukla: If you look at the lowest price perhaps which is existing in entire India is eastern part of India, and particularly in Chhattisgarh. Okay.

Speaker #3: Okay?

Speaker #5: Okay.

Speaker #3: So perhaps you know, prices have not really gone to the level by which, you know, cost has gone up. Right? And this industry is so capital-intensive, right?

Girija Shankar Ray: Okay.

Arun Kumar Shukla: Perhaps prices have not really gone to the level by which cost has gone up. Right. This industry is so capital intensive, and you know that kind of ROC or ROI different players are getting, right. I don't think that prices have gone to that level that there is no headroom. I feel other way, that there is a headroom because cost has gone up drastically.

Speaker #3: Then, you know, you kind of know the ROC or ROI different players are getting, right? So I don't think that prices have gone to that level where there is no headroom.

Speaker #3: I feel, on the other hand, that you know there is a headroom because you know costs have gone up drastically.

Speaker #5: Okay, last question if I may. So our non-trade segment share is 41%, right? A few years ago, most of the players were trying to increase their trade segment, right?

Girija Shankar Ray: Okay. Last question, if I may. Our non-trade segment share is 41%, right. A few years before, most of the players, they were trying to increase their trade segment, right. Now, do you see for next two years, non-trade segment is going to work out more rather than trade?

Speaker #5: So now, do you see that for the next two years, the non-trade segment is going to work out more, rather than trade?

Speaker #3: So, in general, I think this is very difficult to really see, non-trade or trade. Because this segmentation is also based on the margins. To my mind, and other segmentation, of course, you know, B2C and B2B.

Arun Kumar Shukla: In general, I think it's very difficult to really see non-trade or trade because this segmentation is also based on the margin, to my mind, and other segmentation, of course, B2C and B2B. When you really focus on margin part of it, you have different landscape in different states. In general, I think, if you ask me, then yes, of course, trade is better than non-trade on two things. One, of course, overall margin is better, and second, in trade, you sell mostly blended cement, that is anyway beneficial. If you go to that regional nuances, then I think you have a different kind of thing. A player like us, I think we'll have a different strategy in different market with respect to trade and non-trade. Right.

Speaker #3: But when you really focus on the, you know, margin part of it, you have, you know, a different landscape in different states. So, in general, I think if you ask me, then yes, of course, trade is better than non-trade on two things.

Speaker #3: One, of course, overall margin is better. Second, in trade you sell mostly blended cement, so that is anyway beneficial. But if you go to, you know, regional nuances, then I think you have a different kind of thing.

Speaker #3: So, a player like us, I think we'll have a different strategy in different markets with respect to trade and non-trade, right? But overall, if you ask me, yes, of course, I think effort is going to be there on trade even going forward.

Arun Kumar Shukla: Overall, if you ask me, yes, of course, I think effort is going to be there on trade even going forward, more so because mostly blended cement gets sold in trade segment. That gives you a better equivalent realization than selling other products. Maybe I think absolute price or the margin, if you look at them, maybe other products will look a little higher. If you really look at equivalent contribution considering clinker factor, then blended is always better. Overall, I think trade is going to kind of focus area in coming future also. I don't see that is going to trade maybe in couple of years.

Speaker #3: More so because, you know, mostly blended cement gets sold in the trade segment. And that gives you a better equivalent realization than, you know, selling other products.

Speaker #3: Right? Maybe, I think if you look at absolute price or the margin, then maybe other products will look a little higher. If you really look at, you know, equivalent concrete equivalent contribution considering clinker factor, then blended is always better.

Speaker #3: So overall, I think trade is going to be a kind of focus area in, you know, the coming future also. I don't see that it's going to tilt, you know, maybe in a couple of years.

Speaker #5: Of course. Got it. Thank you, sir. Thank you very much, and all the best.

Girija Shankar Ray: Got it. Thank you, sir. Thank you very much, and all the best.

Speaker #1: Thank you. Press star one to ask a question. We take the next question from the line of Aditi from Abacus. Please go ahead.

Operator: Thank you. Press star and one to ask a question. We take the next question from the line of Aditi from Abacus. Please go ahead.

Speaker #4: Hello sir. Could you share some more color on the SPV that you guys have done for the solar power purchase?

Operator 3: Hello, sir. Could you share some more color on the SPV that you guys have done for the solar power purchase?

[Analyst] (Abacus): Hello, sir. Could you share some more color on the SPV that you guys have done for the solar power purchase?

Speaker #3: Yes. This is a yes, we have taken the captive power route for having this 42 megawatt of solar power in an SPV, in which we are likely to invest about 20 crores.

Arun Kumar Shukla: Yeah. We have taken about captive power route for having this 42 megawatt of the solar power in the SPV, in which we are likely to invest about INR 20 crore, and that will give us a payback of less than two years. We have contracted that solar power at a fixed tariff of INR 4.10, which landed to us, which will cost us about INR 5.85. It will substitute the grid power, which is currently costing INR 7.50. Per unit INR 1.65 saving would be there. That gives it.

Speaker #3: And that will give us a payback of less than two years. We have contracted that solar power at a fixed tariff of four rupees ten paisa which landed to us with cost is about five rupees eighty-five paisa.

Speaker #3: So it will substitute the grid power, which is presently costing seven rupees fifty paisa. So, per unit, one rupee sixty-five paisa saving would be there.

Speaker #3: So, that gives a payback of...

Speaker #4: Okay sir. Thank you.

Operator 3: Okay, sir. Thank you.

[Analyst] (Abacus): Okay, sir. Thank you.

Speaker #1: Thank you. Press star one to ask a question. We will take the next question from the line of Pradeep Kumar from Jefferies. Please go ahead.

Operator: Thank you. Press star and one to ask a question. We take the next question from the line of Prateek Kumar from Jefferies. Please go ahead.

Speaker #5: Yeah. Hi, sir. Good evening. My first question is, can you discuss how the reported 8% growth in volumes was? What would be your region-wise or regional growth or regional utilization for the company?

Prateek Kumar: Yeah. Hi, good evening. My first question is, can you discuss how reported 8% growth in volumes? What would be your region-wise or regional growth or regional utilization for the company?

Speaker #3: So utilization is at seventy-six percent. I do not have, you know, regional—as you know, growth I think is difficult now. Maybe, I think, we can give you a little later, but I know I am not having that.

Arun Kumar Shukla: Utilization is at 76%. I do not have regional growth. I think it's difficult now. Maybe I think we can give you little later, but right now I am not having that.

Prateek Kumar: Okay. Also, can you discuss the progress on your Northeast expansion program?

Speaker #5: Okay. Also, can you discuss the progress on your Northeast expansion program?

Speaker #3: So, in the northeast, yes, two mines which we have got through auctions—now planning is in process and happening.

Arun Kumar Shukla: In Northeast, yes, two mines which we have got through auctions, now mining plan is in stages of approval.

Prateek Kumar: Sir, you're not audible.

Speaker #5: Sir you are not audible.

Speaker #3: Am I audible? Hello?

Arun Kumar Shukla: Am I audible? Hello.

Speaker #5: Yeah. Yeah now it's better.

Prateek Kumar: Yeah. You're now better.

Speaker #3: Yes. So what I said was, as you know, we had got mines in the northeast through auction. The leased mines are at different phases of approval.

Arun Kumar Shukla: Yes. What I said was, as you know that we had got mines in Northeast through auction. These mines is at different stages of approval. Mining plan submission, getting environment clearance and things like that. That we are doing. Parallelly also, we have a plan to put up, of course, initially 1.5 million in Northeast. For that also, we have started activities. Of course, plant, land, then getting all those clearances before identifying locations for grinding stations. Those things are happening. We are on track now. Northeast project has come back on track. Maybe in next quarter, I give you some discrete details because how different activities are at different stages of approval. When we achieve some milestone, then we'll update you further in, perhaps in next quarter or the quarter after.

Speaker #3: So, mining plans submission, getting, you know, environment clearance and things like that—so that we are doing. And parallelly, also, we have a plan to put up, of course, initially, 1.5 million ton in Northeast.

Speaker #3: For that also, we have started activities. Of course, plant land, and then getting all those, you know, clearances before identifying locations for grinding stations.

Speaker #3: So those things are happening. So, we are on track now. The northeast project has come back on track. Maybe in the next quarter I'll give you some, you know, discrete details because now different activities are at different levels of, you know, approval stages.

Speaker #3: So once we achieve some milestone, then we'll update you further, perhaps in the next quarter or a quarter later.

Speaker #5: The related capex of Rs 1,500 to 2,000 crore over the next three years is not including this expansion, right?

Prateek Kumar: The indicated CapEx of INR 1,500 to 2,000 crore over next 3 years is not including this expansion, right?

Speaker #3: So it does include that. It does include that.

Arun Kumar Shukla: It does include that.

Prateek Kumar: It does include. Okay. My last question is on your opening remarks. You said that annual shareholder resolutions are opposed by proxy advisors, and some investors also voted against them. Could you share how company engages with these proxy advisory firms? We also got similar query, and institutional shareholders for such key resolution, and any changes in the process, if you think so, to reduce the likelihood of such outcomes.

Speaker #5: So it does include. Okay. And my last question is on, you know, opening remarks. You said that annual shareholder resolutions were opposed by proxy advisors, and some investors also voted against them.

Speaker #5: Could you share how the company engages with these proxy advisory firms? Because we also got a similar query and institutional shareholders for such key resolutions, and any changes in the process you think could help reduce the selectivity of such outcomes?

Arun Kumar Shukla: We directly don't get engaged beforehand with the proxy advisors. What these proxy advisors do, they have their own set of guidelines for various resolutions. There they are having their own regulations, which is over and above what the Companies Act or the SEBI LODR guidelines are. 2 days before the voting starts, they issue their report, recommended report and give us 48 hours to comment on that. Beforehand, they don't give. They make it public, and then they give us. Once we submit our representation based on their recommendation, then if they feel right, they issue an addendum. Generally, addendum, they just attach the company's response and may or may not change their recommendation. For last several years, where maybe we have been engaging with these proxy advisors, they just attach the company's response

Speaker #3: We don't directly get engaged beforehand with the proxy advisors. What these proxy advisors do is, they have their own set of guidelines for various resolutions.

Speaker #3: And there they are, having their own regulations which is over and above what the Companies Act or the, say, the LODR guidelines are. Two days before the voting starts, they issue their report—recommendatory report—and give us forty-eight hours to comment on that.

Speaker #3: Beforehand, they don't give. They make it public, and then they give us. Once we submit our representation based on their recommendation, then if they feel it's right, they issue an addendum.

Speaker #3: Generally, an addendum doesn't—they just attach the company's response and may or may not change their recommendation. For the last several years where I've been, we have been engaging with these proxy advisors, and they just attach the company's response and don't change their recommendation.

Sudhir Bidkar: Don't change their recommendation. Fortunately, when we made the representation this time, the proxy advisors, I don't want to name, said, Yes, we agree to what the company says, but our guidelines doesn't allow us to change the recommendation, though we think that what the company says is right. That is one of the proxy advisors' response there too was. The second proxy advisory said, Yes, we fully agree. Earlier they had said, Your resolution is non-compliant legally. Then they changed that to, Yes, the resolution are fully legally compliant, but still they are not changing their recommendation. We don't have any mechanism, nor do they entertain any direct interaction of the company beforehand.

Sudhir Anna Bidkar: Don't change their recommendation. Fortunately, when we made the representation this time, the proxy advisors, I don't want to name, said, Yes, we agree to what the company says, but our guidelines doesn't allow us to change the recommendation, though we think that what the company says is right. That is one of the proxy advisors' response there too was. The second proxy advisory said, Yes, we fully agree. Earlier they had said, Your resolution is non-compliant legally. Then they changed that to, Yes, the resolution are fully legally compliant, but still they are not changing their recommendation. We don't have any mechanism, nor do they entertain any direct interaction of the company beforehand.

Speaker #3: Fortunately for this, when we made the representation this time, the proxy advisors—I don't want to name them—said, "Yes, we agree with what the company says, but our guidelines don't allow us to change the recommendation."

Speaker #3: Though we think that what the company says is right. That is one of the proxy advisors' responses there too. The second proxy advisory said, yes, we fully agree.

Speaker #3: Earlier, they had said, "Yes, the resolution is non-compliant, legally." Then they changed that to, "Yes, the resolutions are fully legally compliant." But still, they are not changing their recommendation.

Speaker #3: So, we don't have any mechanism, nor do they entertain any direct interaction with the company beforehand. It's only after they release the report that they give us either 24 hours or 48 hours to comment on it, and then they issue an addendum attaching the company's response thereto.

Sudhir Bidkar: It's only after they release the report, they give us either 24 hours or 48 hours to comment on that, and then they issue addendum attaching the company's response there too, without changing their recommendation. That is what it is. Then we expect the mutual funds and the FIIs, based on the company's response, to take a pragmatic view. Fortunately for us, as I mentioned in my opening remarks, very many mutual funds and FIIs were able to understand the company's point of view. Despite there being a negative recommendation by these proxy advisors, voted in favor of the resolutions, and these came out with all these resolutions were passed with the requisite majority, whatever was required, including the special resolutions.

Sudhir Anna Bidkar: It's only after they release the report, they give us either 24 hours or 48 hours to comment on that, and then they issue addendum attaching the company's response there too, without changing their recommendation. That is what it is. Then we expect the mutual funds and the FIIs, based on the company's response, to take a pragmatic view. Fortunately for us, as I mentioned in my opening remarks, very many mutual funds and FIIs were able to understand the company's point of view. Despite there being a negative recommendation by these proxy advisors, voted in favor of the resolutions, and these came out with all these resolutions were passed with the requisite majority, whatever was required, including the special resolutions.

Speaker #3: Without changing their recommendation, that is what it is. And then we expect the mutual funds and the FIs, based on the company's response, to take a pragmatic view. And fortunately for us, as I mentioned in my opening remarks, very many mutual funds and FIs were able to understand the company's point of view.

Speaker #3: And despite being they are being negative recommendation by these proxy advisors voted in favor of the resolutions and these came out with all these resolutions was passed with the requisite majority whatever was required.

Speaker #3: Including the special resolutions.

Speaker #5: Thanks for your detailed explanation.

Prateek Kumar: Thanks for the detailed-

Sudhir Bidkar: Yeah. As far as the proxy advisor is concerned, they don't even give us an opportunity. You know I don't want to name the international proxy advisor based on whom some of the FIIs and very many Indian mutual funds which have some foreign linkage base their opinion or cast their vote on.

Sudhir Anna Bidkar: Yeah. As far as the proxy advisor is concerned, they don't even give us an opportunity. You know I don't want to name the international proxy advisor based on whom some of the FIIs and very many Indian mutual funds which have some foreign linkage base their opinion or cast their vote on.

Speaker #3: Yeah, and as far as lateral proxy advisor is concerned, they don't even give us an opportunity. Nor do they—you know, I don't want to name the international proxy advisor, based on whom some of the FIIs and very many Indian mutual funds, which have some foreign linkage, base their opinion or cast their vote on.

Speaker #5: Sir. Sir, thank you. This is somewhat from my side.

Prateek Kumar: Sir, thank you. This is from my side.

Speaker #3: Yeah thank you.

Sudhir Bidkar: Yeah. Thank you.

Sudhir Anna Bidkar: Yeah. Thank you.

Speaker #5: Thank you. Press star and one to ask a question. We will take the next question from the line of Aditi from Abacus. Please go ahead.

Operator: Thank you. Press star and one to ask a question. We take the next question from the line of Aditi from Abacus. Please go ahead.

Speaker #6: Hello, sir. Just a follow-up question on the solar power purchase. You said that the fossil is around 1.5. When can you see that reflected—in which quarter exactly?

[Analyst] (Abacus): Hello, sir. Just a follow-up question on the solar power purchase. You said that the cost saving is around INR 1.5. When can we see that reflected? In which quarter exactly?

Sudhir Bidkar: We expect this to take about eight to nine months for the project to get implemented. The real benefit will start flowing from the fag end of the Q4.

Sudhir Anna Bidkar: We expect this to take about eight to nine months for the project to get implemented. The real benefit will start flowing from the fag end of the Q4.

Speaker #3: We expect this to take about eight to nine months for the project to get implemented. So the real benefit will start flowing from the fag end of the fourth quarter.

Speaker #3: Nine months from now is almost to a year-end, so hopefully from the first quarter of the next financial year, or if we are lucky and the project gets implemented in January or February, then we get some benefit in the fourth quarter.

Sudhir Bidkar: Okay.

Sudhir Anna Bidkar: Okay.

Sudhir Bidkar: 9 months from now is almost to a year-end. Hopefully from the Q1 of next financial year, or if we are lucky, the project gets implemented in January, February, we get some benefit in the Q4, but otherwise for sure in the Q1 of the next financial year.

Sudhir Anna Bidkar: 9 months from now is almost to a year-end. Hopefully from the Q1 of next financial year, or if we are lucky, the project gets implemented in January, February, we get some benefit in the Q4, but otherwise for sure in the Q1 of the next financial year.

Speaker #3: But otherwise, for sure, in the first quarter of the next financial year.

Speaker #6: All right, sir. Thank you so much.

Operator 3: All right, sir. Thank you so much.

[Analyst] (Abacus): All right, sir. Thank you so much.

Speaker #3: Thank you.

Sudhir Bidkar: Thank you.

Sudhir Anna Bidkar: Thank you.

Speaker #5: Thank you. Participants, this is a final reminder and no further reminders will be announced. To ask a question, press star and one. We take the next question from the line of Harsh Mithal from MK Global Financial Services.

Operator: Thank you. Participants, this is a final reminder, no further reminders will be announced. To ask a question, press star and one. We take the next question from the line of Harsh Mittal from Emkay Global Financial Services. Please go ahead.

Speaker #5: Please go ahead.

Speaker #7: Yeah, thank you. Thank you for the opportunity. Good evening to the management. My first question is regarding your response to the earlier participant's question about the change in geo mix, which was the reason for the higher realization this quarter.

Operator 2: Thank you. Thank you for the opportunity. Good evening to the management. My first question is for your response to earlier participant's question of change in geo mix, which was the reason for the higher realization this quarter. If I just look back in Q3 also, there was a 10% sequential dip in the realization, and now 8.5%. My question is, frequent change in geo mix, doesn't it lead to a loss of market share temporarily in that particular zone? How is the response from your stakeholders, your channel partners in that particular market, sir? This is my first question.

Harsh Mittal: Thank you. Thank you for the opportunity. Good evening to the management. My first question is for your response to earlier participant's question of change in geo mix, which was the reason for the higher realization this quarter. If I just look back in Q3 also, there was a 10% sequential dip in the realization, and now 8.5%. My question is, frequent change in geo mix, doesn't it lead to a loss of market share temporarily in that particular zone? How is the response from your stakeholders, your channel partners in that particular market, sir? This is my first question.

Speaker #7: So, if I just look back, in Quarter 3 also there was a 10% sequential dip in the realization, and now it's 8.5%.

Speaker #7: So my question is, frequent change in geo mix—doesn't it lead to loss of market share temporarily in that particular zone? And how is the response from your stakeholders, your channel partners, in that particular market?

Speaker #7: This is my first question.

Speaker #3: So geo mix is not about, you know, doing this, you know, knee-jerk reaction. Okay? This is a very systematic approach. And perhaps you may be hearing from me that, you know, we have been working on this for the last, you know, more than a couple of years.

Sudhir Bidkar: Geo mix is not about doing this knee-jerk. Okay? This is a very systematic approach. Perhaps you may be hearing from me that we are working on this for the last more than couple of years. Right? During demand months, I think we have an opportunity further improve our geo mix. Okay? That also you need to understand. Maybe I think in lean months, since you want to utilize your capacity, then you go to some other market also. During demand months, you have an opportunity to maximize that. For that, you need to have that channel capability to maximize. This is what has happened. It's not a kind of knee-jerk thing that last quarter we did something else, and this quarter is something else. No, that is not the case. Right?

Sudhir Anna Bidkar: Geo mix is not about doing this knee-jerk. Okay? This is a very systematic approach. Perhaps you may be hearing from me that we are working on this for the last more than couple of years. Right? During demand months, I think we have an opportunity further improve our geo mix. Okay? That also you need to understand. Maybe I think in lean months, since you want to utilize your capacity, then you go to some other market also. During demand months, you have an opportunity to maximize that. For that, you need to have that channel capability to maximize. This is what has happened. It's not a kind of knee-jerk thing that last quarter we did something else, and this quarter is something else. No, that is not the case. Right?

Speaker #3: Right. And you know, during demand months, I think we have an opportunity to further kind of, you know, improve our geo mix. Okay. So, that also you need to understand.

Speaker #3: So maybe I think in lean months, since you want to utilize your capacity, then you can, you know, go to some other market also.

Speaker #3: But during demand months, you have an opportunity to maximize that, and you know, that is what I think. For that, you need to have that channel capability to maximize.

Speaker #3: So this is what has happened. It's not a kind of, you know, knee-jerk thing that, you know, last quarter we did something else and this quarter it's something else.

Speaker #3: No, that is not the case. Right. So, I think we need to understand that a little bit of demand support helps you to speed up the actions which you are intending to take.

Sudhir Bidkar: That I think we need to understand, that a little bit of demand support helps you to speed up your actions which you are intending to take. This is what my response is, all those core markets, still I'm telling you, I think we have four or five states where our concentration is. Right? During demand months, you improve that, your presence in those markets, when demand is not supportive, you go a little wider dispersion as well. We track our market share in our core market. Core market, I told you four, five states. We just see that we are maintaining our core market. That is what our strategy is.

Sudhir Anna Bidkar: That I think we need to understand, that a little bit of demand support helps you to speed up your actions which you are intending to take. This is what my response is, all those core markets, still I'm telling you, I think we have four or five states where our concentration is. Right? During demand months, you improve that, your presence in those markets, when demand is not supportive, you go a little wider dispersion as well. We track our market share in our core market. Core market, I told you four, five states. We just see that we are maintaining our core market. That is what our strategy is.

Speaker #3: So, this is what you know my response is, and all those core markets. And still, I'm telling you, I think we have, you know, four or five states where our concentration is.

Speaker #3: Right. So during demand months, you improve your presence in those markets, and when demand is not supportive, you go for a little, you know, kind of wider dispersion as well.

Speaker #3: So, we track our market share in our core market. Core market, I told you, you know, four or five states. We just see that we are maintaining our core market.

Speaker #3: So that is what our strategy is.

Speaker #7: Thank you. Got it, sir. Got it. Sir, given our timelines of achieving 30 million tons by FY30, are we still maintaining that guidance, or is there some recalibration in that capacity target?

Operator 2: Got it, sir. Sir, given our timelines of achieving 30 million tons by FY30, are we still maintaining that guidance or there is some recalibration in this capacity target?

Harsh Mittal: Got it, sir. Sir, given our timelines of achieving 30 million tons by FY30, are we still maintaining that guidance or there is some recalibration in this capacity target?

Speaker #3: No, we are maintaining that. So we are on track and on track to achieving 30 million tons by 2030.

Arun Kumar Shukla: No, we are maintaining that. We are on track of achieving million tonne by 2030.

Speaker #7: Okay. So then, what would be a threshold of net debt to EBITDA going ahead, until you achieve your thirty million ton goal?

Operator 2: Okay. What would be a threshold of net debt to EBITDA going ahead till you achieve your 30 million tonne goal?

Harsh Mittal: Okay. What would be a threshold of net debt to EBITDA going ahead till you achieve your 30 million tonne goal?

Speaker #3: Yeah we would not like to cross net debt to EBITDA two point five to at best two point seven five times. So you are right based on the our plan which are slightly bullish and aggressive to achieve thirty by thirty.

Arun Kumar Shukla: Yeah. We would not like to cross net debt to EBITDA 2.5 to at best 2.75 times. You are right, based on our plan, which are slightly bullish and aggressive to achieve 30 by 2030. We may, towards the end, maybe 2029, 2030, we'll see that level touching that. So long as the roadmap for tapering it down is clear, we'll pursue our plans.

Speaker #3: We may, towards the end—maybe twenty-nine, thirty—we'll see that level touching that. But so long as the roadmap for tapering it down is clear, we'll pursue our plans.

Operator 2: Got it, sir. Sir, last question. What was the clinker utilization in this quarter?

Harsh Mittal: Got it, sir. Sir, last question. What was the clinker utilization in this quarter?

Speaker #7: Got it, sir. Sir, last question: What was the clinker utilization in this quarter?

Speaker #3: Clinker utilization? Ninety-five percent, I suppose, last quarter. Just see that.

Arun Kumar Shukla: Clinker utilization. 95%, I suppose, last quarter. Just see that.

Speaker #4: Clinker ninety five percent.

Operator 2: 95%.

Harsh Mittal: 95%.

Speaker #3: Yeah ninety five percent. Yeah.

Arun Kumar Shukla: Yeah, 95%. Yeah.

Speaker #7: Sure, sir. Thank you, sir. Those were my questions. Thank you, sir.

Operator 2: Sure, sir. Thank you. Sir, these were my questions. Thank you, sir.

Harsh Mittal: Sure, sir. Thank you. Sir, these were my questions. Thank you, sir.

Speaker #5: Thank you. We will take the next question from the line of Milan S. Raganwar from BOB Capital Markets Limited. Please go ahead.

Arun Kumar Shukla: Thank you.

Operator: Thank you. We take the next question from the line of Milan S. Raganwar from BOB Capital Markets Limited. Please go ahead.

Speaker #6: Thank you, sir, for the opportunity. My first question is on the raw material cost. We see a spike— is there any specific reason that you would like to call out on?

Milan S. Raganwar: Thank you, sir, for the opportunity. My first question is, on the raw material cost we see a spike. Is there any specific reason that you would like to call out on?

Milind Raginwar: Thank you, sir, for the opportunity. My first question is, on the raw material cost we see a spike. Is there any specific reason that you would like to call out on?

Arun Kumar Shukla: Raw material cost you're talking?

Speaker #3: Are you talking about raw material cost?

Speaker #6: Yes, sir. I was on the raw material cost. Yes, I did ask about the raw material cost. We see some inflation there, both sequentially as well as on a year-on-year basis.

Milan S. Raganwar: Yes, sir. I was on the raw material cost.

Milind Raginwar: Yes, sir. I was on the raw material cost.

Arun Kumar Shukla: Sorry?

Milan S. Raganwar: Yes, I did ask about the raw material cost. We see some inflation there, both sequentially as well as on a year-on-year basis. Would you like to call out on what would be the reason for that?

Milind Raginwar: Yes, I did ask about the raw material cost. We see some inflation there, both sequentially as well as on a year-on-year basis. Would you like to call out on what would be the reason for that?

Speaker #6: Would you like to point out what could be the reason for that?

Speaker #3: Yeah, so I'll tell you. One is, of course, you know, I guess, cost, because during April, May, June, some of the go-go shut down.

Arun Kumar Shukla: Yeah. I'll tell you. One is, of course, fly ash cost, because during April, May, June, summer season, we go for shutdown. During shutdown, we are required to procure fly ash from far off places. That has impacted a bit. This is one. In case of gypsum also, at times, gypsum availability. A combination of various gypsum which we use like, chemical gypsum, mineral gypsum, coal gypsum. Sometimes, based on the availability, and that has happened in last quarter, our cost has gone up. We are expanding non-cement business. Yeah. Of course, I think since our footprint has gone up in case of SVS business or non-cement business, and since that raw material cost also is included in this. As I said that our last quarter turnover was INR 185. It's gone up.

Speaker #3: And during shutdown, we are required to procure fly ash from far-off places. So that has impacted a bit; this is one. And in case of, you know, gypsum also, at times, you know, gypsum availability, right.

Speaker #3: So, combination of various gypsum which you use—like, you know, chemical gypsum, mineral gypsum, coal gypsum, right? So sometimes, you know, based on the availability and that has happened last quarter, our cost has gone up.

Speaker #4: We have expected non-human business.

Speaker #3: And yeah and of course I think since our footprint has gone up in case of SBS business or non cement business and since that raw material cost also is included in this as I said that you know our last quarter turnover was one eighty five gone up right.

Speaker #3: So, raw material consumption has gone up in SBS, and that has impacted overall, you know, raw material cost inflation.

Arun Kumar Shukla: Raw material consumption has gone up in SVS, and that has impacted overall raw material cost in cement.

Speaker #6: Sir, did I hear that the fly ash availability was an issue, or that the cost went up?

Milan S. Raganwar: Sir, did I hear that the fly ash availability was an issue or the cost went up?

Milind Raginwar: Sir, did I hear that the fly ash availability was an issue or the cost went up?

Speaker #3: No. So in some places, I think the issue was that some of the thermal plants went for shutdown, which they do every year.

Arun Kumar Shukla: No. Combination. In some of the places, I think, the issue was some of the thermal plant went for shutdown, which they do every year. Since fly ash is something which is necessity for our operations, we procure this from other source, which is, I would say, Tier-2 source. Temporarily that cost goes up. In some of the places we also took part in auction. Where fly ash cost has gone up little bit.

Speaker #3: And since fly ash is something which is a necessity for our operations, we procure this from another source, which is, I would say, an L2 source. So, temporarily, the cost goes up.

Speaker #3: Right. In some places, we also took, you know, part in an auction, right? And there, you know, fly ash cost has gone up a little bit.

Milan S. Raganwar: Yes, sir. I'm asking this because our blending on a Q1 and Q2 basis has gone up from 62% to 64%.

Milind Raginwar: Yes, sir. I'm asking this because our blending on a Q1 and Q2 basis has gone up from 62% to 64%.

Speaker #6: Yes, sir. I'm asking this because our blending on a Q1-Q2 basis has gone up from 62% to 64%.

Speaker #3: And also, along with this, you know, the diesel price impact has also been there. Right. So, a combination of the diesel price, temporary increase in fly ash costs, and some of the auctions which you participated in—this has impacted the non-cement business raw material requirement.

Arun Kumar Shukla: Also along with this, diesel price. Diesel price impact has also been there. Combination of diesel price, temporary increase in fly ash cost, and some of the auctions which we participated, this has impacted. Non-cement business raw material requirement. That has added up to this increase in raw material cost.

Speaker #3: That has added up to this, you know, increase in raw material cost.

Speaker #6: Yes sir. The blended cement mix has gone up from 62% to 64%.

Milan S. Raganwar: Yes, sir.

Milind Raginwar: Yes, sir.

Arun Kumar Shukla: Yes.

Milan S. Raganwar: cement mix has gone up from 62% to 64%.

Milind Raginwar: cement mix has gone up from 62% to 64%.

Speaker #3: Yeah.

Arun Kumar Shukla: Yeah.

Speaker #6: This was when our availability of other things was slightly tighter. If so, how do we try to, you know, calibrate this?

Milan S. Raganwar: This is when our availability of other things were slightly tighter. How do we try to calibrate this?

Milind Raginwar: This is when our availability of other things were slightly tighter. How do we try to calibrate this?

Speaker #3: Come again? I think I didn't get you properly; your voice was not so clear. Yeah, go ahead.

Arun Kumar Shukla: Come again. I think I didn't get you properly. Your voice was not so clear. Yeah, go ahead.

Speaker #6: So am I audible clearly?

Milan S. Raganwar: Sorry. Am I audible clearly?

Milind Raginwar: Sorry. Am I audible clearly?

Speaker #3: Yeah you are.

Arun Kumar Shukla: Yeah, you are.

Speaker #6: No, I'm saying the blended cement percentage has gone up from 62% to 64%.

Milan S. Raganwar: No, I'm saying the blended cement percentage has gone up from 62% to 64%.

Milind Raginwar: No, I'm saying the blended cement percentage has gone up from 62% to 64%.

Speaker #3: Right.

Arun Kumar Shukla: Right.

Speaker #6: So, how do we—I mean, you know—try to... When we were having issues procuring certain raw materials, our blended cost, blended cement product proportion, is going up.

Milan S. Raganwar: How do we try to When we were having issues procuring certain raw material, our blended cement product proportion is going up. Would you like to throw some light on this?

Milind Raginwar: How do we try to When we were having issues procuring certain raw material, our blended cement product proportion is going up. Would you like to throw some light on this?

Speaker #6: So is it is it I mean would you like to throw some light on this?

Speaker #3: Yeah I'll I'll I'll do that. So our trade percentage has gone up last quarter it went to fifty nine percent. And trade is mostly goes you know blended cement.

Arun Kumar Shukla: Yeah. I'll do that. Our trade percentage has gone up last Q. It went to 59%. Trade mostly goes blended cement. Blended cement, you need other than clinker, other cementitious material and majorly fly ash and slags. When your trade volume goes up, your raw material cost goes up, then whatever fly ash availability is there, source, I think you may have to go to Tier-1 source to cater to your increased demand. Getting me? Trade sales increase necessitated us to procure more fly ash or more cementitious material, which asks us to go little Tier-1 source to kind of fulfill our demand. Right. I think everything is connected. Okay?

Speaker #3: And you know, for blended cement, you need, other than clinker, other cementitious materials, and mainly fly ash and slag, right? Now, when your trade volume goes up, your raw material cost goes up as well. Then, whatever fly ash availability is there—L1 source—I think you may have to go to L2 source to cater to your increased demand.

Speaker #3: Getting me? So, trade sales increase necessitated us to procure more fly ash or more cementitious material, which asked us to go a little, you know, L2 source to kind of fulfill our demand.

Speaker #3: Right. So, I think everything is connected. Okay.

Speaker #6: Very nice, sir. And the inward freight—is it built into the raw material cost or is it in some other line item?

Milan S. Raganwar: Fair enough, sir. The inward freight is built in the raw material cost or in some other line item?

Milind Raginwar: Fair enough, sir. The inward freight is built in the raw material cost or in some other line item?

Speaker #3: Yeah yeah.

Arun Kumar Shukla: Yeah.

Speaker #6: Okay. Sir, what would be our petcoke mix vis-à-vis year-on-year and Q1, Q2?

Milan S. Raganwar: Okay. Sir, what would be our petcoke mix vis-a-vis year on year and Q1 Q?

Milind Raginwar: Okay. Sir, what would be our petcoke mix vis-a-vis year on year and Q1 Q?

Speaker #3: Okay. So Petco was, last quarter, six.

Arun Kumar Shukla: Okay. Last quarter it was 16%. If you compare that with earlier quarter, it was 14%.

Speaker #4: Last quarter, it was sixty-two.

Speaker #3: Sixteen percent. And if you compare that with the earlier quarter, it was fourteen percent.

Speaker #6: Sir, I just missed the earlier number. Last quarter was forty, this quarter it was?

Milan S. Raganwar: Sir, I just missed the earlier number. Last quarter was 14%, this quarter it was?

Milind Raginwar: Sir, I just missed the earlier number. Last quarter was 14%, this quarter it was?

Speaker #3: Fourteen percent Petco this quarter means the quarter which has ended on 30th June.

Arun Kumar Shukla: 14% petcoke. This quarter means quarter which has ended on 30 June.

Speaker #6: Okay, okay. Understood. Sir, the third thing is that we hear about some litigation issues in Assam regarding land procurement. Would you like to comment on that in some detail?

Milan S. Raganwar: Okay. I understood. Sir, the third thing is that we hear some litigation issues in Assam land procurement. You will like to call out on that some in detail?

Milind Raginwar: Okay. I understood. Sir, the third thing is that we hear some litigation issues in Assam land procurement. You will like to call out on that some in detail?

Speaker #3: Yeah, yeah. So we had, you know, acquired land from the local council, Assam government, for setting up a plant in the Northeast, right? So some of the nearby villages, they have gone for PIL, claiming that, you know, this land belongs to us, or maybe—I think they are inhabitant somehow for so many years.

Arun Kumar Shukla: Yeah. We had acquired land from local council, Assam government, for setting up plant in northeast. Some of the nearby villagers, they have gone for PIL claiming that this land belongs to us or maybe I think they are inhabitants somehow for so many years. This happens everywhere you go, and this is what the hassle across India is. They filed one PIL in the Gauhati High Court, Assam. This was Mahabal Cement, I think you know that we were planning to set up a grinding plant in the name of Mahabal Cement, which is our subsidiary. Since Mahabal Cement was subsidiary or is subsidiary for JK Lakshmi Cement, they have kind of made us also one of the recipient of the notice of that PIL. This is what the case is. This case was going even from before.

Speaker #3: And this happens, you know, everywhere you go, and this is what the hassle across India is. So, they filed one PIL in the High Court of Guwahati, Assam.

Speaker #3: Right. And this was, you know, Mahabal Cement. I think you know that we were planning to set up a grinding plant in the name of Mahabal Cement, which is our subsidiary.

Speaker #3: Right. Now, since Mahabal Cement was a subsidiary, or is a subsidiary, of JK Lakshmi Cement, they have kind of, you know, made us also one of the recipients of the notice of that PIL.

Speaker #3: So, this is what the case is. This case was going on even from before, right? This time, they have added JK Lakshmi also because Mahabal Cement is a subsidiary of JK Lakshmi Cement.

Arun Kumar Shukla: This time they have added JK Lakshmi also because Mahabal Cement is a subsidiary of JK Lakshmi Cement.

Speaker #6: Okay. And on the lead distance that we are, you know, highlighting on, how is this going to be a permanent improvement, or can this go back? Typically, in the monsoon quarters we try to phase—

Milan S. Raganwar: Okay. On the lead distance that we are highlighting on, is this going to be a permanent improvement or this can go back to typically in the monsoon quarters we try to see.

Milind Raginwar: Okay. On the lead distance that we are highlighting on, is this going to be a permanent improvement or this can go back to typically in the monsoon quarters we try to see.

Speaker #3: It will go up in monsoon, it will go up. I just told before because it will go up a little bit in monsoon. Though we'll try to contain it because we need to kind of—we've targeted to our team members.

Arun Kumar Shukla: In monsoon it will go up. I just told before, because it will go up a little bit in monsoon, though we'll try to contain it because we need to kind of give target to our team members. It will go up during lean months like July, September. Nine months we do have an opportunity to kind of squeeze in.

Speaker #3: But it will go up during, you know, lean months like, you know, July to September. But for nine months we do have an opportunity to kind of squeeze in.

Speaker #6: Thank you. Due to time constraints, we request participants to please restrict themselves to one question each. We will take the next question from Nilesh Sharma of Moromo Capital.

Operator: Thank you. Participants, due to time constraint, we request you to restrict to one question per participant. We take the next question from the line of Nilesh Sharma from Monomer Capital. Please go ahead.

Speaker #6: Please go ahead.

Speaker #7: Hello sir.

Nilesh Sharma: Hello, sir.

Speaker #6: Nilesh please yes go ahead.

Operator: Nilesh, please go ahead.

Speaker #7: Sir, my question is: What will be the company's installed and operational capacity by the end of this financial year?

Nilesh Sharma: Sir, my question is, what will be the company's installed and operational capacity by the end of this financial year?

Speaker #3: Eighteen million ton.

Arun Kumar Shukla: 18 million tons.

Speaker #6: Thank you. We will take the next question from the line of Tushar Chaudhary from Prabhudas Lilladher Private Limited. Please go ahead.

Operator: Thank you. We take the next question from the line of Tushar Chaudhari from Prabhudas Lilladher Private Limited. Please go ahead.

Speaker #8: Hi sir, thanks a lot for the opportunity. I missed your CAPEX number. Did you say fifteen hundred, two thousand, and fifteen hundred for the next three years, which is like only five thousand crores?

Tushar Chaudhari: Hi, sir. Thanks a lot for the opportunity. Sir, I missed your CapEx number. Did you say INR 1,500, INR 2,000 and INR 1,500 for next three years, which is like only INR 5,000 crores?

Arun Kumar Shukla: Yeah, you are right.

Speaker #8: Got it. But then, are we going slow on capex because our Durga and Kutch projects are ahead in order compared to Northeast and Nagore? At Durg, we have only spent ₹400 crore till now out of ₹3,000 crore.

Tushar Chaudhari: Are we going slow on CapEx because our Durg and Kutch are ahead in order than North East and Nagaur. Durg we have only spent INR 400 crores till now out of INR 3,000 crores. Do you think by FY28 end we will be able to complete Durg?

Speaker #8: So, do you think by the end of FY28 we will be able to complete Durg?

Speaker #3: Durg—it does include Durg, because out of the 5,000 crore CAPEX, which is the number given, we are talking about 3,000 crores for Durg.

Arun Kumar Shukla: It does include Durg because out of INR 5,000 crores CapEx which number given we are talking of about INR 3,000 crores for Durg and INR 1,500 crores for North East. This CapEx number doesn't include the land acquisition cost which we are presently doing for Nagaur and Kutch. In any case, Nagaur and Kutch would come later than North East and Durg. Right. Your number what you have noted are correct.

Speaker #3: And fifteen hundred crores for the Northeast. This CAPEX number doesn't include the land acquisition cost, which you are presently incurring for Nagore and Kutch. In any case, Nagore and Kutch would come later than the Northeast and Durg.

Speaker #3: Right. So, the numbers you have noted are correct.

Speaker #6: Thank you. We will take the next question from the line of Philip Mathai from Geojit Financial Services Limited. Please go ahead.

Operator: Thank you. We take the next question from the line of Philip Mathai from Geojit Financial Services Limited. Please go ahead.

Speaker #8: Thank you, sir, for taking my question. Just with regard to your recent acquisition of STLC, you had mentioned you are going to set up a 28-megawatt battery energy storage system.

Philip Mathai: Thank you, sir, for taking my question. I just with regard to your recent acquisition of STLC. You had mentioned you are going to set up a 28 MW battery energy storage system. I just want your rationale on that.

Speaker #8: I just want your rationale on that.

Speaker #3: So this is based on the demand-supply balancing which we do, right? So what happens is, in case of return, you can set up, you know, power to the extent of twice your contract demand.

Arun Kumar Shukla: This is based on the demand supply balancing which we do. What happens is, in case of you can set up solar power to the extent of twice of your contract demand. Based on the demand pattern we have within our plant, we see that how much we can store this without losing even the unit. Because let's say you produce excess unit, this goes back to the grid. Maybe perhaps, the banking facility which Rajasthan Government has given, you can set it off within one month. Based on the demand pattern, how much we are going to solar power, how much consumption is there within the plant, and over and above, how much we are required to store within storage so that we are not wasting energy which is being produced out of it.

Speaker #3: Right. And based on the, you know, demand pattern we have within our plant, we see how much we can store this without losing even a unit.

Speaker #3: Because if you, let's say, produce excess units, this goes back to the grid, right? And maybe, perhaps, you know, the banking facility which the Rajasthan government has given, you can set it off within one month.

Speaker #3: So, based on the demand pattern, how much, you know, we are going to power, how much consumption is there within the plant, and over and above, how much we are required to kind of store within storage so that we are not wasting energy which is being produced out of it.

Speaker #3: Right. So, based on that, we have decided on a 28 megawatt batch.

Arun Kumar Shukla: Based on that, we have decided on 28 MW BESS.

Speaker #6: Thank you. We will take the last question from Uttam Kumar Shrimal from Axis Securities. Please go ahead.

Operator: Thank you. We take the last question from the line of Uttam Kumar Srimal from Axis Securities. Please go ahead.

Speaker #8: Sir, yeah, thanks for the opportunity. Sir, with regard to non-cement revenue, how do you see full-year non-cement revenue this year?

Uttam Kumar Srimal: Yeah. Thanks for the opportunity, sir. Sir, with regards to non-cement revenue, how do you see full year non-cement revenue this year?

Speaker #3: You know, why is it so—non-cement revenue—for the whole year you are talking?

Arun Kumar Shukla: Non-cement revenue for the whole year you're talking?

Speaker #8: Yes sir. Yes sir.

Uttam Kumar Srimal: Yes, sir.

Speaker #3: Projected figure right. Or last.

Arun Kumar Shukla: Projected figure, right?

Uttam Kumar Srimal: Yes.

Uttam Kumar Srimal: Last year?

Speaker #8: Non-cement revenue. Entire non-cement revenue for this year.

Uttam Kumar Srimal: Non-cement revenue. Entire non-cement revenue for this year.

Speaker #3: Okay. This year—so last year, it was how much?

Arun Kumar Shukla: Okay. This year, last year it was how much? INR 6.3. Perhaps I think we'll be around INR 800 crore plus, right? This is what I think our estimation is. We'll be closer to around INR 800 crore top line in case of non-cement revenue by end of this year.

Speaker #8: Six hundred. Six hundred.

Speaker #3: So perhaps I think we'll be around, you know, ₹800 crore plus. This is what I think our estimation is. So we'll be closer to about, you know, ₹800 crore top line in case of non-cement revenue.

Speaker #3: By end of this year.

Speaker #6: Thank you. Ladies and gentlemen, with that, we conclude the question-and-answer session. I now hand the conference over to Mr. Vaibhav Agarwal from Philip Capital India Private Limited for closing comments.

Operator: Thank you. Ladies and gentlemen, with that, we conclude the question and answer session. I now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital India Private Limited for closing comments. Please go ahead.

Speaker #6: Please go ahead.

Speaker #7: Yeah, thank you. Sir, just one small question from my side. In the Q1 FY27 results, what I see is that there is a sharp jump in other expenses, both on a year-on-year as well as quarter-on-quarter basis.

Vaibhav Agarwal: Yeah, thank you. Sir, just one small question from my side. Sir, in the Q1 FY27 results, what I see is there is a sharp jump in other expenses also on a YOY as well as QOQ basis. Any specific reason for this sharp jump in other expenses? I don't know whether you have explained this on the call already or not. Sorry for the repetition.

Speaker #7: Is there any specific reason for this sharp jump in other expenses? I'm not sure whether I should already explain this on the call or not. Sorry for the repetition.

Speaker #3: Can you elaborate on other expenses? You mentioned in response to one of the questions, Vaibhav, that it was basically because of the increase in the packing cost and the normative increase due to higher volumes.

Arun Kumar Shukla: Other expenses?

Vaibhav Agarwal: Yeah.

Arun Kumar Shukla: It was mentioned in the response to one of the questions above that it was basically because of the increase in the packing cost and the normative increase because of the volumes. That's all. Other than that, it's not there.

Speaker #3: That's all. Other than that, it's nothing.

Speaker #7: Okay, sir. Got it. Thank you, sir. On behalf of Philip Capital, I would like to thank you for the opportunity to join the call. Also, many thanks to your participants for joining the call.

Vaibhav Agarwal: Okay, sir. Got it. Thank you, sir. On behalf of PhillipCapital, I would like to thank you for the call opportunity. Also, many thanks to your participants joining the call. Thank you very much, sir. Ryan, you can now conclude the call. Thank you.

Speaker #7: Thank you very much, sir. Ryan, you may now join the call. Thank you.

Arun Kumar Shukla: Thank you. Thanks very much. Thank you, everyone. Thanks, everyone.

Speaker #3: Yeah, you, thanks Vaibhav. Thank you, everyone. Thanks, everyone. Thank you.

Speaker #6: Thank you. On behalf of Philip Capital India Private Limited that concludes this conference call. Thank you for joining us and you may now disconnect your lines.

Operator: Thank you. On behalf of PhillipCapital India Private Limited, that concludes this conference call. Thank you for joining us. You may now disconnect your lines.

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Q1 2027 JK Lakshmi Cement Ltd Earnings Call

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