Thank you, Yashashvi, and good evening, everyone, and welcome to Nuvoco's Q1 FY27 earnings call. Thank you for joining us today.

To begin with, I'd like to mention on our performance for the quarter first. We have had a strong start to the year, delivering higher business performance.

Volume grew by 5% YoY to 5.3 million tons, and EBITDA increased by 7% YoY to ₹572 crore, marking the highest-ever first-quarter volume and EBITDA of the company. The performance is on the backdrop of the geopolitical tensions which prevailed during the quarter, which had a cascading effect on business environment in which we operated.

The West Asia conflict, which drove up energies, packing bags, and other raw material prices, was not the only challenge during the quarter. We also faced logistical constraints, with railway rakes being prioritized for the power sector amid an intense and prolonged summer.

Further, one of our key states in the east was undergoing state elections during the period. Net-net, we performed well in Q1 FY27 despite the macro headwinds.

The performance reflects resilient execution, supported by continuous focus on cost discipline and operational efficiencies. To specifically highlight: Fuel cost was contained at 1.52 per Mcal, which remained within the guided range communicated in the last quarter conference call.

This was achieved through fuel mix optimization and coordinated efforts of our team. Coming to Vadodara, I'm pleased to share that we have inaugurated 2 million tons per annum of grinding capacity at Surat on 11th July 2026 ahead of schedule.

This represents a defining milestone in the history of the company, signifying our first-ever capacity expansion in the Western region. This achievement is a strong testament to the company's project execution capability.

It will not only enable a significant expansion of our market presence in the West, but also strengthen our position in the North by releasing much-needed capacity at our Rajasthan plants for the Northern market. The clinker and the grinding units at Kutch are also progressing well and remain on track for phased operationalization from Q3 FY27.

Let me highlight some of the key developments and progress made on these units so far. At Kutch, for the clinker unit, deliveries of all major equipment and spares have been completed, and execution across all sections remains firmly on track.

Reconditioning of coal and raw mills VRM gearbox has been completed. Kiln rotation is also complete and is now ready for pre-clining.

We will complete overhauling of all major equipment and initiate trial preparation within Q2 FY27. As far as grinding unit at Kutch is concerned, civil works are underway and progressing as planned.

Major RCC work in packing plant and hopper building have been completed. Civil works are targeted for completion by Q2 FY27, enabling the release of fronts for mechanical and electrical installations.

On the railway siding at Kutch, earthwork has been completed, and ballast and sleeper laying are currently in progress. Once operational, the siding is expected to enhance logistical efficiency.

Moreover, we have also commenced work on the bulk cement terminal at Sachana in Gujarat, which will also have a dedicated railway siding. This facility is targeted to be operational by Q2 FY28 and will act as a strategic distribution hub, helping us strengthen our presence and further expand our reach across the Gujarat market.

For our East operations, we continue to progress on our plan to add 4 million tons per annum of capacity in phases till FY28. Looking ahead, we continue to hold a positive outlook on cement demand, which stayed healthy throughout the quarter.

Just to highlight, Central Government capex increased by 13% YoY to 2.5 lakh crore in the quarter-to-date period through May 2026, already accounting for nearly 20% of the full-year planned capex. As highlighted earlier, both Central and State Governments are targeting capex growth of 17% and 15% respectively for FY27.

Accordingly, infra spending led by government capex and along with housing projects is expected to provide sustained support to demand. From a geopolitical standpoint, we remain watchful and continue to monitor the situation closely.

If the geopolitical situation stabilizes and the conflict de-escalates, we are cautiously optimistic about navigating the coming quarters well. As demonstrated in Q1, where we proactively worked on our internal levers to deliver strong cost and operational performance, we remain confident in our ability to manage through headwinds.

Regardless of how the scenario unfold, we remain firmly committed to driving cost efficiencies and operational excellence across the business. We will continue to pursue with same rigor through prudent procurement, continued cost optimization, and ongoing improvements in supply chain efficiency to deliver resilient performance going forward.

With that, I conclude my opening remarks. I'm here with Mr.

Jayakumar Krishnaswamy, Managing Director of Nuvoco Vistas, and Mr. Maneesh Agrawal, Chief Financial Officer.

We are happy to answer any questions you may have. Thank you, Yashashvi.

Over to you.

Hi.

Can you hear me now? Am I audible?

Perfect. Perfect.

I just wanted to check, since our Surat plant is now online-

Can't hear you. Don't put on speakerphone, please.

You've got to take the handset and talk, because you're very feeble.

Is it better now?

Give it a try.

Just wanted to check, sir, given that our Surat plant is now online, what sort of volume cadence are we looking at for this year? Secondly, given the fact that our clinker capacities are yet to come online, what will be the source of clinker for this capacity?

Okay. If you remember in all my previous calls, we had very clearly explained the sequence of startup with Surat coming in Q2, Q3 this year, and then the clinker capacity in Kutch comes in Q3, Q4 this year, and then on the WHR and the grinding unit later at railway siding.

Right from the beginning, it was clear that when we start Surat, we'll have to get clinker from elsewhere and not from Kutch. Currently before Vadodara started, we were anyway selling close to a million tons in Gujarat, which came from our Chittor and Nimbol plants.

What's going to happen is the 1 million ton anyway will come from Chittor and Nimbol in the balance period, and also till such time even it'll go all the way up to about 1.4, 1.5 million tons in annual basis from Chittor and Nimbol plant. The balance, our target is when we complete Q4 this year, our sale in Gujarat will be anywhere close to about 2 million tons as an annual sale.

Basically, it'll be about 1.6, 1.7 lakh tons per month in the Q4 of this year, which should mean it'll be about 30,000, 40,000, 50,000 tons more than the average run rate which we are selling currently in Gujarat. For that, we need clinker, and those clinker will come from our Chhattisgarh cluster.

That's how even the first dispatches are made through clinker which is sourced from Chhattisgarh cluster. I can't move clinker from Chittor into Surat because that clinker is needed for the North market.

We are also working at some of the options like bartering with other companies whereas we can give some clinker in East and also pick up clinker from North, which will be much more economical than moving our own clinker from Chhattisgarh cluster into Surat. Net-net, at the initial till such time Kutch comes on stream, which will be earliest will be January this year, maybe give or take one or two months, certain by start of fiscal FY28, we'll have Kutch clinker coming into Surat.

For the balance currently 1.5 million million ton sale and Q4 2 million tons sale, for the incremental sale, clinker will come from Chhattisgarh cluster.

Understood, sir. My understanding is that on an incremental basis, you will perhaps do close to a million tons extra in Gujarat.

Is that correct?

Currently, we're doing 1.3, 1.4 million, balance 0.6 million tons we will have extra sale in Gujarat, which will happen since we have launched the product and then covering most of the Gujarat now. Q4, we will sell 2 million tons annualized rate.

That for the incremental volume of cement, clinker will come from Chhattisgarh.

Got it, sir. That's very clear.

Secondly, sir, just wanted to check, our East debottlenecking plants seem to be sort of facing some delays. From what I recall, last time we had CTO for two of our plants, around 2 MTPA capacity, but there seems to be no update regarding that.

Sir, anything you want to add to that?

No, we had debottlenecking happening in Jajpur, Jojobera, Panagarh, and Arasmeta. Last time in the call, I had said we had got our CTO for our Panagarh and Jojobera facility.

I think those two plants are almost done, and Jajpur is a place where there's something called an NIPL certificate which you have to get because when your capacity increases less than 50% of the installed capacity, then you don't go through the normal EC route, you get through NIPL route. There I think the Jajpur thing is currently underway.

Arasmeta, the technical design is completed. We are more or less at the commercial conversations about ball mill procurement, and the rest of the civil ordering is being done.

By the time we complete this fiscal, we should be ready on all four fronts. Suffice to say that these capacities which we were expanding in East was not needed to sell products for the fiscal FY27.

It will be needed in fiscal FY28 only because with the current sale plan and the current ambition for the company in fiscal FY27, we have adequate capacity in all our blending stations. Just that we need more flexibility for state-wise capacity, and that's the reason why we are not kind of pursuing at a rigorous pace for this.

By the end of this fiscal '27, three plants will be fully commissioned and ready for volumes for FY28. Arasmeta should be on by end of this fiscal '28 and will be fiscal '27 and will be available in Q1 FY28.

Those plans are also on stream. Just want to assure all of you that there is no delay because the modification involved are very minor modifications, not major modification.

It's overall capex cost was pretty less for all these four plants. Just that the timing and the facing is there.

Right now, we are not hard-pressed for capacity, I'm not kind of really pursuing it with that rigor. Two plants CTO is done, the other two plants will happen in the next 6 to 8 months.

Understood, sir. Thank you.

Hi. Good evening, and thanks for the opportunity.

Just wanted to understand the pricing and costs a bit better. We see that you had quite a strong pricing improvement in the quarter.

At the same time, there was some moderation in the YoY growth, which is roughly 4%. Wanted to understand was there also a change in mix within trade, non-trade which happened in the quarter, or is the pricing gain attributable purely to market-level price hikes?

Sorry, I was on mute. Thank you for the question.

Last time when we met was in the conference call in April, and that was when the entire Middle East was raging. Then one of the big things which was happening in the industry as well as for ourselves was we had to do a price correction to defray the cost increases.

Which overall, if you look at the April month and then subsequently the full quarter, for the quarter, we had a trade price increase, which it increased more, but then overall it got tempered. For a full-quarter level, we got a ₹10 per bag increase in trade and ₹20 per bag increase in non-trade in the quarter for in East.

In North, again, we got about ₹10 per bag in trade and about ₹10, ₹12 in non-trade. Throughout the quarter, if you look, we had a price increase of close to about Just a second, the previous paragraph.

The bar chart. Overall, we got an overall price increase of close to about ₹240 in the entire quarter.

The the one more unique thing is when we went to the end of the quarter, we exited June quarter, sorry, June quarter with price increase more than the average for the quarter, and that kind of stayed put as we started the month of July. I will also try and give a detailed breakup of the realization and the cost impact.

Overall, if you see, our realization has gone up by close to about ₹320 Q1 versus Q4. That came mostly through three reasons.

One was the NDT increase, second was the geomix which we played in key markets of Chhattisgarh, Rajasthan, Western MP, and Jharkhand, and also the price increase in the last 15 days of March which kind of gave a fillip to the first month of the quarter. Hence, we got a realization increase of 320.

This ₹320 got kind of set off by cost inflation which I mentioned during the previous call. The first cost increase happened for the quarter Q1 versus Q4: Power and fuel went up by approximately ₹40 per ton.

Raw material cost also went up close to about ₹35, ₹40 per ton. Packing bags, I mentioned about the granule issues as well as the capacity shortage and the jute issue from Bangladesh, which overall increased the packing bag cost, that also increased close to about ₹15 per ton.

The volume impact from Q4 to Q1 resulted a little bit of a fixed costs deleverage of close to about ₹30, ₹40. Other one which also impacted the quarter one was the distribution cost.

Freight cost for the company like-to-like from Q4 to Q1 went by close to ₹50, largely coming out of suboptimal movement because of diesel shortage and truck shortage in certain states, and also due to the fact that the railways stopped supplying adequate number of rakes due to coal movement, and we resulted moving clinker by road. Net-net, realization happened ₹320, and the cost increase was close to about ₹230, which reflects in the EBITDA impact of close to about ₹90.

That's been the story of Q1 when compared to Q4.

Got it. Thanks for the elaborate answer on that one.

Pricing, just to understand better, I think you mentioned that your realization improvement was better than the market. That was a function of geomix optimization, as in more trade in the mix, or how is it?

Three things: One is obviously price increase happened. That is the biggest lever is the price increase, close to about ₹10 in trade and about ₹15 in non-trade, so that's kind of the biggest impact on the overall realization improvement.

Second one is obviously we are a premium player with increased share in Concreto, Uno, and Duraguard Microfiber. I'm happy to report to all of you that both these brands have become a 1 million ton brand now.

We're very happy that in a very short span of time, these two brands have now become an annualized 1 million ton sale added to Concreto, which is close to about 3.9 million tons. We can safely say that with 4 million tons of Concreto, 1 million of Microfiber, and 1 million of Uno, we're close to about 5 million tons of premium and super-premium products.

That's the second reason. The third one was positive impact due to increased sales in Chhattisgarh, Jharkhand, Rajasthan, and Western MP, which are high-realization markets for us.

Three reasons: One is price, second is premium, third is geomix. Sure,

sure. Thanks a lot.

I'll come back in the queue.

Hi. Thank you.

First, wanted to understand, you discussed all the line items on the cost side, where the fuel cost have been, what kind of inflation you see in 2Q and would that be the peak and you start seeing moderation? Just trying to understand fuel inventory and wafer hedging costs and all that.

Satyadeep, just to rephrase, are you asking about the fuel blend for the company, specifically?

No, you said there has been inflation-

Can you speak a little bit louder? I'm missing a few words in your question, please.

Yes. Yes,

yes. You mentioned the fuel consumption cost was 1.53.

Where the fuel costs have trended the last few months? Where do you see fuel and packaging and all these costs?

Has there been improvement on the rail evacuation? Just trying to understand what kind of

impact

you see in 2Q.

Yeah. I'll give you the reasons.

I'll have to split the whole blend into East operations of Nuvoco and North operations of Nuvoco. North operations of Nuvoco is largely petcoke driven with 23%, 24% of AFR in both the Chittor and Nimbol facility, whereas on East operations, we have close to about 30% of petcoke and balance is domestic open-market coal and linkage coal and very small amount of AFR, which is to the tune of about maximum Risda 10%, but overall plays about 4%, 5%.

That's how we have been operating till this crisis happened. Every crisis is an opportunity for us to look into the operations and revisit the entire assumptions.

What we did in Q1 was three things we did: One was question the very principle of using petcoke, and hence our teams did a wonderful job by curtailing the use of petcoke in North from excess of 50% to about 42% number. For the first time, we could move domestic open-market coal from Chhattisgarh cluster to our Chittor plant and also from Varanasi depot to our Nimbol plant.

Even though the normal rate, we couldn't have used this coal, but because of the heightened price of petcoke, this became viable, and hence we kind of moved material from Varanasi depot to Nimbol and Nagpur to our Chittorgarh. That's how the North petcoke consumption reduced from over 50% to about 40%.

That's about the North blend. When it came to East, we have the Risda factory, Sonadih, and Arasmeta.

In all these three plants, we had petcoke consumption excess of about 30% was the number. During this quarter, we were lucky enough to contract coal from Eastern Coalfields, which is called Sonepur Bazari, whose ash content is much better than the other linkage coal ash content.

I think our purchase team did a wonderful job. By using this specific variety of coal which comes from West Bengal, whose ash percentage is much lower than the Chhattisgarh coal, and the number-two thing which we did was we started adding little bit of sweetener in our Risda factory.

Sweetener is again a better-quality limestone, and so we started using better-quality limestone, whose CaO and LSF is much better in our Risda kiln and also in our Sonadih from our ML-1 line. By increasing sweetener usage, increasing the Sonepur Bazari coal, we successfully brought down the petcoke consumption during the quarter.

Much so, in Arasmeta, as we speak, we are operating at zero petcoke consumption, and in Risda factory from close to about 37% the petcoke consumption, we've already come to about 25% petcoke consumption because the cost increase due to sweetener is much lower than the cost reduction coming out of petcoke. This was the big agenda which we drew in our Chhattisgarh cluster, and North was getting linkage coal, domestic open-market coal to the North factories.

All these kind of contributed to the overall fuel cost being capped at ₹1.52 per million cal.

Sir, how do you look at the trajectory given you may have consumed petcoke which was lower cost and the traffic is yet moving up? Mainly one, packaging and fuel cost, and also railway, has there been improvement in rake availability?

Just trying to understand so we understand what happened in 1Q, how do you look at the trajectory in 2Q, 3Q?

Okay. Looking at what we face going forward in quarter two, first would be fuel.

I think we have adequate inventory of petcoke for the entire quarter at similar cost levels, my fuel inflation is not likely to go up by big number. I won't be exactly able to tell whether it'll be 1.52 or 1.55, but it's not going to spoil my game in quarter two.

That's the first one. The second thing is about packaging bags.

I think packaging bags has peaked in Q4 and Q1 with highest demand and West Asia crisis also fueled the granule price. I think granule prices have started coming down, and hence the demand also will come down due to monsoon.

Bag availability should not be a problem. The increase in bag which happened close to about ₹15 in Q1 versus Q4, I expect cooling off of that price by around ₹20, ₹25 in Q2 versus Q1.

Bag price will come down, fuel will more or less kind of get capped, and the third one which kind of hit us negative was the non-availability of rakes and we ended up moving clinker by road. Here again, after 15th of July, once the monsoon sets in, I think the coal fields will get flooded and it will not be possible for coal to move, and also the overall power demand in the country will come down with monsoon setting in.

Hence, coal which will be shipped because the government mandate of moving coal from coal fields to the power plants will also taper down. Already in the last one week, we typically get about four rakes per day for clinker movement, and it kind of come down to 3.2, 3.3 in quarter one.

We already started getting in the last one week four rakes per day, and going forward from now till the next 2 to 3 months, it will be certainly four rakes per day and we'll stop clinker in our grinding unit. Last but not the least, the lean season discount will also kick in from 1st of August, and that's a welcome sign.

This time, the Government of India has said even for clinker movement, there's going to be lean season discount, unlike only for cement in the past. We'll get a benefit of railway freight which will come down.

Availability of rakes will eliminate our movement of clinker by road. Then packaging bag will kind of cool down.

Fuel cost will be almost in the same place. Technically, we are looking at cost lines more or less same.

The only thing which will be adverse in Q2 when compared to Q1 will be the power and fuel cost. Fuel remains the same.

Power cost will go up by close to about ₹40, ₹50 per ton simply because this is a shutdown time when two of our kilns are going down in the next two months, and also all our VRMs and ball mills will also go for shutdown in the next 2, 3 months. There'll be an increase in power cost, fuel cost will be kind of capped.

Net-net, there'll be an increase in power and fuel cost by some ₹30, ₹40 per ton.

Thank you so much for this explanation. Just one more question on-

Sure.

Hi, sir. Was there any change in the lead distance this quarter versus last quarter?

Very insignificant. I think last quarter we were close to about 325 km.

Right now it's about 327, 328. Not much of difference in lead distance.

Just that and also rail coefficient was 62 road and 38 rail in Q4. It's about 54 54/46 now.

64/36, sorry.

Okay. Sure.

On the premium product share and share of trade sales for the quarter?

Okay. Premium, we are at about Q1 versus Q4 was peaked at 44%.

This quarter premium is 42%. Trade mix continues to be same 75/75, not much of change in trade mix.

Understood. Lastly, on the net debt number for the quarter?

Yeah. Net debt, we ended the quarter with ₹4,595 crore, and corresponding quarter last year was 5,274, a good ₹600 crore reduction from last June '25 to June '26.

Sure. Thanks.

Hi, thank you, sir. Sir, just to get a couple of things clarity.

Sir, you mentioned that the exit June cement prices or the realization is higher versus the 1Q FY27 average. Can you quantify, will it be a kind of ₹5, ₹10 per bag higher?

We reported quarter one versus quarter four was close to ₹320 realization improvement. Which would mean exit June is slightly lower than the average June because the price increase happened at the beginning of the quarter.

However, as we start the quarter, one of the things I've seen this industry for a few years now, and the welcome sign is there is no price drop in the first 14 days of July, which is a welcome sign. I think we are holding on to our prices.

Normally monsoon, there's always a drop in price. The first two weeks of the month, it's steady and then I'm holding on to all the prices which I had in the month of June.

Which even though we've not taken a price increase, but I think prices holding on first fortnight of July, I think it's something which is unique for this year. I think it's a welcome sign.

Still, we will not wait for an opportunity. As of now, costs are kind of stable, but certainly I think if the costs were to go southwards, I will take price northwards.

Okay. Now, sir, given that once this Surat we have already started and let's say in Q3 once we start the commercial production for the clinker at the Kutch level, maybe and the full-fledged is in the Q4, how do we kind of see on that part if we have to see on the profitability front?

Will it be much, much lower versus currently what we are having a profitability? Or how one can look at?

Or if it is lower by how many quarters one can see that profitability of this Kutch, including the Surat grinding, would be at par with the company average?

Look, I guess whenever you expand in any region with huge capacity, any cement player who has expanded capacity in a particular region or in a particular state, something, if you have to kind of get volumes going as quickly as possible because having put so much of capex, I need volumes very quickly. I need to get back my investment as fast as possible.

We will play an aggressive way to sell our product. One thing is for sure, my positioning as an A-group will never reduce.

Even in the markets where we operate in Rajasthan, Western UP, Western MP, Western UP, Haryana, Delhi, even in Gujarat, I am an A-group player and I'm far ahead of any of those other B-group player. There are one or two guys who are almost equal or slightly ahead of us.

That's something which positioning is going to be very, very keen for us. Also in Gujarat, non-trade realization contribution is also quite good with OPC and almost equal to rest of the product.

Gujarat contribution will be quite good. On the initial stages, for me to establish the market, I will have to be aggressive.

What is the positive Nuvoco has? Nuvoco is not a new entrant in Gujarat.

Nuvoco has been in Gujarat for the last 2 years, and we already sell close to about a million and half already. Currently, we're selling 1.

1.3, 1.4 million, whose pricing is almost equal to the big players in Gujarat. When I'm going to increase volume, I'm not going to dilute price.

My job is to get more franchisee, dealers, and expand the dealer network. I have personally met hundreds of dealers, and our teams have connected with 300, 400 dealers in the last 5 to 6 months.

Our market development is at full swing. We are pretty confident that the people, the dealers fraternity in Gujarat very keen to have Nuvoco in places where we are currently not there.

Before launch of Gujarat, we were present in Baroda, we were present in Godhra, we were present in Surat, we were present in Ahmedabad, Banaskantha, all these places were there. Over a period of last six past six months, we also launched our product in Rajkot, Saurashtra, and Porbandar, those areas, and our pricing has been very good in those products, and our contribution margin and our realization is not less than any other major competitor in Gujarat.

Net-net, I'm fairly confident that we will not dilute prices to push volumes in Gujarat. Of course, we'll have to put out some trade schemes to get people working for us, but in general, our positioning will be good, our premiumization will continue to be there, we'll focus on Microfiber.

All this will offset the potential decrease in EBITDA per ton because my cost will be high in the first year. That's the nature of the game.

Overall, I don't think we can judge the performance by the first year of launch into Gujarat, but our modeling very clearly says in year two and year three, EBITDA per ton in Gujarat will be equal to EBITDA per ton of rest of North India.

Okay. Great.

Yeah. Can I ask one more?

Thank you very much. My first question is-

[unclear]

[unclear]

Pinakin, slightly feeble. If you can speak a little bit louder, please?

Sure. If I look at Nuvoco EBITDA per ton over the last six years, it has ranged between ₹700 to ₹900 per ton, but for the last few quarters [unclear].

If we take a step back, do you see-

Can't hear you, Pinakin, I think other than the first sentence, not audible.

Okay. Let me rejoin the queue.

If I look at the EBITDA per ton, do you see the current EBITDA profitability, we know seasonally second quarter is weak, but sustain over the next few quarters? Can Nuvoco deliver over ₹1,000 a ton?

Ultimately, it's dependent on pricing, but how do you see pricing therefore evolve given the what was commented by other industry players in May of holding back capacity expansions?

Pinakin, I guess I will not be able to give a guidance on what will be the EBITDA per ton going forward. That's not be appropriate.

Certainly, I think what are the things which works for us is our geomix, premiumization, our trade, non-trade, and our blended cement. Those are the strengths of Nuvoco and the positioning of Nuvoco which will be there.

When you compare with what was the past period and what do I see now and future, I think the past period, last FY23, '24, '25, had very specific events in the industry which kind of impacted the overall pricing in the industry. If you to see, I think all of you observe the market and we also observe the market.

If you see certainly in the last 3, 4, 5 quarters, I think profitability is very, very important, and it's important for us and I'm sure for everybody else in the industry. Hence, I think pricing is relatively stable in the last 1, 1.5 years.

I also see going forward pricing is going to be pretty stable, and I'm sure all of you heard the investors call for other companies. I'm not going to comment on that, but I guess all of us realize that there will be capacity expansion, but capacity expansion is not going to be at the breakneck speed.

Since capacity expansion is not going to be at a breakneck speed and it'll be in a sensible pace, and also with the internal levers of our company, I believe price will be stable going forward. With the stable price and the positioning of our company in terms of product, portfolio, market, geomix, I think we will be better off in managing, improving the profitability levels in the coming quarters.

Thank you, sir. That is very helpful.

Just moving on to my second question. The more accepted norm with investors is that North is the most profitable market in the country, and East is under pressure, and for the last five years, East was impacted by more supply.

Now, this year there is supply, but we don't see more capacity additions being announced in East. Do you see or, in your view, what will take East pricing structurally higher over the next couple of years?

What will it require for East to close the gap with North?

From the capacity expansion announcements which have been informed by all the major players, there are not many clinker units which are going to come in the next 3 years. I think a couple of them which are coming, and those couple of them are not going to disturb this.

Clinker used to be about 40, 42 million ton capacity, that went close to about 60 million tons, and that was the period of last 3, 4 years when all the capacities bunched up around the same time and did not give elbow room for pricing to improve. That is done, and from the announcements, all of us know that in the next 3 years, there are going to be only max three and at the best two.

Even if someone were to announce now, it's going to take anywhere between FY29 and thereabouts. With market growing at 7%, 8% conservatively, very soon in the next 18 to 24 months, capacity utilization of the entire East is going to again cross 80%.

If it were to go to 80%, pricing will become stronger and then obviously profitability in East also will improve. That's the way I am looking at.

In short, I won't be able to put a exact number whether profitability in East will be equal to profitability in North, but I know our company what kind of profitability we get in the region. I'm fairly confident the profitability which we are getting in East is good now, and we'll continue to be good going forward.

Got it. This is very helpful.

Thank you very much, sir.

Hi. Thank you for the opportunity, and congratulations on a very good set of numbers despite challenging environment.

Sir, my first question is regarding your capex guidance, which you gave last quarter, ₹900 crore and ₹960 crore for FY27, '28. Is there any change in that?

My second question will be on the, your how are you seeing, first quarter has been completed and second quarter is going on, how are you seeing demand for FY27? Because last quarter, a lot of your peers painted a very bearish picture in terms of demand for this year.

How are you evaluating the demand this, year?

Okay. Capex first, I guess I communicated in the last call that the outlook for FY27 capex was ₹900 crore, it continues to be ₹900 crore.

In Q1, we have spent close to about ₹370 crore, the balance money will be spent in the next three quarters. We're more or less on course to complete what we intended to do this year.

Next year, again, with the expansion of Vadodara going to be completed and then the Sachana bulk terminal which got announced and routine capex in the plants, I'm looking at close to about anywhere between ₹950 to ₹1,000 crore number. That's the range as I look at now.

This year 900, next year 950 to 1,000, give or take ₹10, ₹20 crore here and there. That's going to be the outlook.

As regards the other point regarding the cement demand, I think demand in Q1 was still I think a little bit more than we delivered because we could have delivered more in Q1 as well, but for the rake availability, we lost some production, sale in April, May, June. I could have easily done close to about 2 lakh tons more, because the demand was decent.

Just because we couldn't get rakes and then diesel shortage and Chhattisgarh trucks would not move to Maharashtra and MP because there was no return load, and we had serious bunching of rakes in Northeast as well as in Bengal. Overall sale growth could have been more, which should have been more for us, did not happen the way I thought.

Market demand, I thought was anywhere close to 7%, 7.5% in Q1. Going forward, also I'm looking at a market demand around the same number.

Just that the government change in Bengal has happened, I think it'll take maybe a quarter or so for overall schemes to be announced on the ground and effect on the ground to happen. Certainly Jharkhand is doing well, after many quarters in Odisha, we did very well in Q1, Bihar continues to be a strong citadel for us.

I guess I'm looking at a demand anywhere between 7%, 8% in the next three quarters.

Thank you for that, sir. Sir, my second question is regarding Gujarat profitability.

I understand you have already given an elaborate answer on that, that from the second and third quarter, Gujarat profitability will be in line with rest of Nuvoco, but I still want to focus on Surat GU, because even when the Kutch clinker unit comes, I think Chittorgarh is still nearer to Surat plant than the Kutch unit. Is it fair to assume that Kutch will be more profitable in terms of EBITDA per ton than Surat unit, or is the company working on something to improve the profitability of the Just wanted to focus on that.

Technically, if you see, I won't compare performance of other companies which have put up plants in Kutch, but that's one of the hypothesis we thought, and that's the reason why we decided to put a grinding unit in Kutch. Without a grinding unit and only a clinker unit, part 3.5, 4 million ton of clinker either by sea route was almost a difficult proposition for anybody who tried doing it.

The original assumption was that at that time, but I guess that probably a very difficult assumption one made. That's the reason once we kind of got into the act, and very early in the acquisition and reconstruction phase, we decided that to make this entire model work well, we need three ways to make this model successful.

The first way is to get clinker through maritime route into Hazira port and into Surat. Certainly, I think 2, 3 months of the year when the monsoon happens, clinker cannot be moved, hence we needed a rake.

Fortunately for us, railways line was coming till Raghavpur, and I think within 3, 4 months, that program of railways came into being, and we immediately latched on, we modified our project plan, and we decided to go for the railway line. Once we had the railway line, and then also the jetty movement, our clinker movement via marine route or through the rake route is a certainty.

Of course, moving clinker through jetty route, marine route is far cheaper than moving by rake, that's clear. Second thing we did was if we had to move clinker all the way because Gujarat market is a lot OPC market, if I had to kind of move clinker to Surat, grind in Surat, whereas the market is also going to be in Ahmedabad, rest of the place, I'll do reverse movement.

Hence, the entire idea of setting up a GU happened in Kutch, and also with the incentive scheme available in Gujarat, it became economically sensible for us to put a full-fledged GU there. I will make OPC and/or PPC and sell in Kutch and rest of the Morbi, Kandla area from our Kutch plant.

The third idea which we implemented is the Sachana bulk terminal with the railway's BTF wagon movement, which we will also invest. There we are working whether lease or purchase, which had a option that on the return freight was zero freight, there was only forward freight.

We decided that instead of taking clinker, you'd much rather grind the clinker and take OPC to Sachana, and in Sachana we'll move from rake bulker to road bulker. Once we do debulk into road, then Sachana is only 40-odd kilometers from Ahmedabad, the core market.

I would do Mehsana, Ahmedabad, and rest of the region, I'll do bulker movement from our Sachana unit. Sachana unit also has a bag packing facility, in case I have to sell cement in bags, I also will sell cement by bag from our Sachana.

Technically speaking, Kutch plant GU will help me sell in Kutch and part of Saurashtra up to Morbi, then I come to Sachana, which will help me sell to Rajkot and all the way to Ahmedabad, and then Surat will help me sell in Surat going all the way to Vapi and even Mumbai, and also of course to Godhra, and in the border area of Rajasthan, I'll still get cement from Chittorgarh. That's the overall plan which we have envisaged, and it's far less riskier than what others have attempted in the past.

Thanks so much.

Yeah. Hi, good evening, sir.

Am I audible?

Yes, Rajesh. You're audible.

Great, sir. Great set of numbers.

Sir, my question pertains to guidance for FY27. Per se, if you look at what I understand in Q2, your variable cost, the fall in packing cost will offset the power cost increase due to the plant shutdowns.

Mostly your variable cost seems to be stable quarter-on-quarter in Q2, and there would be off-lay and maintenance cost, which will have some drag on the cost line item. Given that if prices were to remain stable, would that mean we will have another strong quarter in terms of margins, upward of ₹900 or closer to ₹900 sort of margins, assuming prices remain stable where they are?

That will be very difficult, Rajesh, to give that information, but I wish price 15 days is stable. I think hopefully price is going to be stable.

Also kind of the cost inflation with the kind of targets which I have, I'm anyway looking at about 100-odd rupees in increase in cost line in Q2 versus Q1. That's the way I'm looking at right now.

It's too early in the day for me to kind of put a finger on it. As I see with the fuel cost, with the inventories which I have, and the packing cost which has happened in 15 days, and the price holding back, and shutdown plan which we have, this is the kind of number we are working on for Q2.

Total cost you're looking at ₹100 inflation, Q-on-Q, and then obviously the pricing will decide your margins, right?

One can safely say it'll be thereabouts. Give or take some ₹20, ₹30 you should always plan because it's not such an accurate industry.

Small variables will always happen. Some uncertainties will creep in the quarter.

Sure, sure. Sir,

subsequently, because Q2 you're not seeing an impact of fuel large impact of fuel price increases, but in subsequent quarters, given the current prices will only the the new purchases hereon will be flowing into a lower cost, but purchases which you have ordered in month of say, May, June, early July, they would be at elevated costs. Would that further infuse your cost number in Q3 in terms of fuel cost?

It's possible because technically Q3, I think the little bit higher-cost inventories will come. Some of the things which we have done, I won't be able to tell on the call, I think our purchase team has been very smart to find out what consignments at what price to book and what price not to book.

Suffice to say that there's going to be impact, but it is not going to kind of change the overall game big time, unless and until here and now, because petcoke went all the way to ₹2.56 per million cal, we refused to book at that prices. We kind of curtailed the booking at much lower at 2.05 or 2.15 was the number which we booked.

This is all helping us. If the entire price were to continue this way for a month or two months, things have started cooling down, but if it were to continue, I guess it's anybody's guess what will happen.

Understood. Any volume guidance-

I'll just complete this question and move off. Any volume guidance for FY27, sir, you're looking at?

I think our target is to get close to about 5-8%, 7-8% of market growth. That we would go for it.

With incremental volume anyway will come for us in Gujarat, obviously North we are very strong, and Gujarat volume will always add to the overall volume growth of the company. Which I'm really targeting mid 7-8% kind of a number.

Great, sir. That's all from my end.

Thank you. Will come back.

Thank you.

Good evening, sir. I'll go back to the same question in terms of realization.

If I understand the revenue break-up is 60% East and 40% North, correct me if I'm wrong. Despite moderation in costs, which apparently through high use of coal and less use of petcoke, how has the price realizations improved in North and East?

Should that be the case for the entire industry? Is there some spillover from the fourth quarter to the first quarter?

Because realizations ₹240 per bag, is per ton is slightly I'm not able to understand this number. Maybe if you can explain to me again, I'll be able to understand that better.

I'll kind of explain that in the Q-on-Q, which is Q4 versus Q1, through the quarter in North, I had a ₹10 per bag price increase in trade and close to about anywhere between ₹10 to ₹15, ₹12, ₹13 per bag on non-trade. That's where the impact.

So, ₹10 is certainly ₹200 per ton and then ₹15 is also ₹300 per ton. Our proportion of trade and non-trade in Northern region is more than the proportion of trade and non-trade in East.

To that extent, the weighted average price came to around mid in between 200 and 300, that's how I tried to explain. Mathematically, if I had to go to 40% in North and 60% in East and so I don't think at this point of time, I will be able to give exactly how much we benefited in North, how much we benefited in East.

As a whole of company, we've got a price increase of close to ₹240, it's ₹12 per bag.

You never- There were no constraints in terms of availability of bag, and the cost of bag did not impact your cost at all?

I'm sorry, can you repeat the last sentence, please?

I said the impact of unavailability of bags, which was also a concern in the third fourth quarter of FY26, iska

koi impact nahi aaya Q1 pe? Serious issues of bag, certainly in February, March, and then also in April, May, June.

The problem in Q4 was huge demand, problem in Q1 is not exactly demand, but also due to the fact that granule prices went up. We are a company which uses a lot of LPP bags, not the HDPE bag.

Since we are indexed on LPP bags, the impact was much more. As we came to the month of June and now July, in the quarter one, we had to give a lot of incentives to cover capacities, but that's kind of going away now.

Q2 certainly the incentives will go away because the overall demand for the industry itself will come down, and all the bag manufacturers won't be in a position to extract price increase.

Okay. Because eventually the impact of anything does not seem to be reflecting in the costs.

Very well managed costs, great set of numbers. Thank you so much.

Thank you.

Yeah. Sir, what was our blended share for 1Q?

You have mentioned in terms of the plant-level petcoke share, but at a company-level for 1Q, what was the petcoke share and the coal share?

Okay. 1Q, I told earlier, I'll repeat it again.

Fuel million cal 4Q was 1.44, 1Q was 1.52, that's the overall fuel mix. When you go to petcoke petcoke, Q4 was 1.84, and Q1 was Q1 came at 2.01.

Sir, I was asking more from a fuel mix perspective, what was the petcoke as well as- Percentage?

Okay. I'm sorry.

I thought you're asking million cal. Let me just give you the data.

Petcoke was 4Q was 37%, 1Q 27%, 10% reduction in the overall mix. Our

coal share was how much in 1Q?

Coal was 53% in 4Q and 67% in 1Q. AFR was 10% in 4Q and 6% in 1Q.

Okay. Blended cement share in 1Q was 83%?

Blending ratio is 82%. Give or take decimals, 82.

Okay.

Just one more, sir. Just to get this Jojobera and Panagarh where we got the CTO, both this 1-1 million ton will be starting in Q2 or Q3?

Look, it is available for me. Right now in monsoon period, obviously demand will be there.

This number will be useful for me in Q4 when my numbers will go up. I need to dispatch close to about 20,000 tons per day in Jojobera.

If I have to do 20,000 tons per day in Jojobera, this 1 million ton headroom will help me. Similarly, in Panagarh, we used to do about 7,000-odd tons per day.

Our target is to go to 8,500 tons per day. These are the numbers which will come into play in Q4, and this increase in capacity in Jojobera and Panagarh will help me get this consistent 8,500 per day and 21 20,500 per day.

Okay. Thank you, sir.

Thank you for your questions and active participation today. We hope the discussion proved insightful and the IR team remains available for any post-call clarifications.

As we come to the end, I want to leave you with a few thoughts. Our growth journey remains on track.

2 million tons Surat grinding unit inaugurated ahead of schedule, along with the upcoming Kutch plant expected to be operational in the near term, will significantly enhance our presence across Western India. At the same time, this will help us free up capacity at our Rajasthan plants, enabling us to further strengthen our position in the Northern markets.

We will continue to focus on delivering growth and internal levers, including geomix optimization, cost optimization, and premiumization, which will underpin long-term value creation for all stakeholders. Thank you once again for your trust and support.

We look forward to engaging with you again soon. Thank you, everyone.