Thank you, Prashil. I'd just like to add that during this conference call we'll start with opening remarks from the management following which we will have the floor open for an interactive Q&A session.

Before we begin, I'd like to point out that some statements made in today's discussions may be forward-looking in nature, and a note to that effect was stated in the concall invite sent to you earlier. We trust you had a chance to go through the communications that were emailed yesterday.

I would now like to hand over to Mr. Reddy to make his opening remarks.

Over to you, Sreekanth.

Thank you, Gavin. Good morning, everyone, and welcome to Sagar Cements earnings call for the quarter ended December 31st, 2025.

Let me begin the discussions with a brief overview of the market, post which I will move on to the Sagar-specific developments. As we have indicated, overall demand during the quarter, especially the first half, was relatively subdued owing to extended monsoons and festive season.

However, we did witness pick-up towards the later stage. This trend is continuing as we speak, increasing our confidence of ending the fiscal on a positive note with overall volumes of around 6 million tonnes.

Supported by pick-up in demand and better pricing trends will result into improved financial performance. In Q3 FY26, Sagar registered a volume growth of 8% year-on-year, while our revenue for the quarter stood at ₹591 crore compared to ₹564 crore in Q3 FY25, an increase of around 5%.

EBITDA for the quarter stood at ₹38 crore, which is same as previous year's Q3 numbers. EBITDA per tonne stood at ₹254.

We continue to work towards improving efficiencies and profitability through various cost cost-reduction initiatives, including WHRS and solar capacity additions, lead distance optimization, plant upgrades. Additionally, we expect in improving cash flows and planned land monetization to support prudent growth going forward.

Loss after quarter, sorry, loss after tax during the quarter stood at ₹64 crore. Our projects at Andhra Cements and Jeerabad are progressing as per plan.

The construction of the 6-stage preheater at Dachepalli plant of Andhra Cements has been successfully completed and was recently commissioned. 4.35 megawatt waste heat recovery project at the Gudipadu unit is expected to be commissioned by end of FY26.

We also expect to commission the expansion of Jeerabad capacity from 1 million to 1.5 million tonne by early part of Q1 FY27, and the cement capacity addition at Dachepalli by August 2026. Power and fuel cost stood at ₹1,408 per tonne as against ₹1,456 per tonne reported during Q3 FY25.

Freight cost for the quarter stood at ₹830 per tonne as against ₹835 per tonne during Q3 FY25. From an operational point of view, Mattampally plant operated at 57% utilization, while Gudipadu, Bayyavaram, Jeerabad, Jajpur, and Dachepalli plants operated at 82%, 66%, 95%, 40%, and 39% respectively during the quarter.

As far as the key balance sheet items are concerned, gross debt as on 31st December 2025 stood at ₹1,627 crore, out of which ₹1,320 crore as a long-term debt and the remaining constitutes the working capital. Net worth of the company on a consolidated basis as on 31st December 2025 stood at ₹1,694 crore.

Debt-equity ratio stands at 0.78:1. Cash and bank balances were at ₹83 crore as on 31st December 2025.

In summary, we remain committed to delivering sustainable and profitable growth for strengthening the operational strengthening the operational excellence, deepening our regional presence, and increasing the use of renewable energy across our manufacturing footprint. That concludes my opening remarks.

We would now be glad to take any questions that you may have. Thank you.

Hi. Shravan here from Dolat Capital.

Hi, sir. Couple of questions.

First, just on the demand front, and we'll then come to the pricing part. Last time, whatever the number we have said in terms of the growth for individual state of the South and for FY27 26 and '27, will the number remain same, or is there any change?

Primarily, we were saying a high single-digit growth for AP, Telangana for this year FY26, flat to marginal positive for Tamil Nadu, and 3% to 5% for Karnataka. Just your thought on that front.

Good morning, Mr. Shravan.

I think the numbers what we have discussed during the last quarter call, they more or less hold good. They could be slightly better, but as we speak, the demand uptick has been extremely strong.

The numbers what we have committed, I think they are holding as discussed before, Mr. Shravan.

Okay. For us now when we are saying a 6 million tonne for this year FY26 volume, if I just translate and I'm assuming this is only the sales volume and not the clinker, that means that the fourth quarter of this year FY26 we are looking at just a 2.6% kind of a growth.

I hope that the fourth quarter growth definitely should be a kind of a 7% in the range of that. Just wanted your thoughts.

Is this the number on the lower side that we are saying, and for FY27 last time we said 7 million tonne odd, so that number remains intact?

Now let us talk of the current financial year's outlook. It is 6 million.

We did indicate in the past that these are subject to some corrections based the price. The price has been volatile, basis that from a 5.8 million, we re-revised it to 6 million.

We are holding it to the 6 million now. It should roughly translate close to year-on-year number of close to around 9%, Mr.

Shravan. Going to the next year number, yeah, we are holding at this point of time for a 7 million outlook for the coming financial year.

Yeah. Now, sir, on pricing front, just want your clarity.

In terms of the state-wise if you can spell, in this January what we heard is there is a decent hike of ₹15, ₹20 odd in the non-trade front. Your thought, and if you can also specify in terms of the state level how much till now from 1st January till now the hike is there in non-trade and also at the same time on the trade front has there any hike, and if yes, how much?

Yeah. From the middle to end of December, we started increasing the prices.

From end of December to now, yeah, we did get around ₹15 to ₹20 increase on a non-trade. Though at the trade level the price increase we started increasing only during the first week of January, but in this part of the world, as Pongal is an important festival.

We tried increasing almost ₹15 to ₹20, but so far we could only realize anywhere between ₹5 to ₹10 in trade, Mr. Shravan.

I'm speaking across the states that we operate. Most of the trends are very similar across all the South states.

In Madhya Pradesh, the price increase happened slightly ahead of almost close to ₹10, that is at the end of November itself, non-trade. It's mostly in the non-trade.

Trade prices have been very flat, again for our Madhya Pradesh plant, Mr. Shravan.

Got it. Given this scenario, in terms of for us in terms of the profitability, for 9 months roughly around ₹478 EBITDA per tonne is there and we were looking at ₹600 odd.

How one can and at the same time, do we now believe that even at the end of the let's say once the March starts and given the capacities which are slightly delayed and now will come up on the stream, this price increase can sustain? Is this the structural price hike, or maybe roll-back likely to happen in the March?

If that is the case, then how one can look at the profitability for us?

In our case, sir, what we are trying to factor is not a very steep price hike. The current price hike is we are as close as just before the GST revision has happened.

It's not that we are gone back to the Q1 pricing, which was extremely healthy. Given this scenario, what we have penciled in for the Q4 is around ₹550 EBITDA per tonne.

In all, we should end up very close to ₹500 odd EBITDA per tonne to ₹525 EBITDA per tonne for the full financial year. That includes the incentives, Mr.

Shravan.

Got it, sir. Got it.

Thank you, sir, and all the best.

Yeah. Hi, sir.

Good morning. I am Rajesh Ravi from HDFC Securities.

My question pertains to am I audible?

Good morning, Mr. Rajesh.

You are very much audible. Oh,

great. Sir, if I look at the standalone versus Andhra performance, the cost structure is still shockingly different.

I believe your clinker plant is already stabilized at Andhra Cements. How should we look at your standalone operating cost per tonne hovers around close to 3,900, whereas it is for the Andhra Cement capacity these numbers are still very high.

Mr. Rajesh, I think you should look at we've only commissioned the new preheater at Andhra, sir.

All in all, from a year-on-year kind of a number, you should expect around ₹250 per tonne kind of a reduction at Andhra. Now when you look at the cost, sir, it again adds up the freight.

It could be significantly different across the plants. When you look at standalone, yeah, it includes Jajpur, it also includes Gudipadu.

Each of the unit has its own characteristic and proximity to the markets. All in all, if you look at Andhra's performance, sir, it has been significantly better.

We are trying to align it to be the other group companies, especially with the Mattampally, because Mattampally plant happens to be one of the most cost-efficient plants. The idea is to replicate the same cost here at Andhra.

I would not say that we have reached there because Andhra doesn't have waste heat recovery compared to Mattampally. If you look at specific consumptions and all, we are almost very, very close or better than Mattampally because obviously this is a brand new preheater.

Given this situation, fortunately, in the last quarter itself, we are very close to the breakeven. I think in the current quarter itself, we expect Andhra to breakeven.

With the better prices, we hope it should become profitable in the current quarter itself, Mr. Rajesh.

Understood. For ex-factory operating cost, because that number would be more comparable at your end, how much Andhra would be still higher in terms of the cost structure versus Mattampally plant?

Right. That's

again, see, up to clinker, I think there is a gap because the electrical power cost at Mattampally includes almost 90% of the power comes from green sources for Mattampally, sir. Whereas in Andhra, we still source from the grid.

Only 6 megawatt solar plant is operational. Except for that, on a specific power consumption, sir, Mattampally is almost at 725 to 730 kcal per kg of clinker, whereas Andhra is almost sub-720 kcal per kg of clinker.

Up to clinkerization, electrical units for Mattampally is around 52 units, whereas Andhra is at 51 units. On a specific consumption, Andhra is already below Mattampally, but the landed cost of fuels as well as the energy cost is slightly different.

It would take some more time before we could on a rupee, we could be very close to Mattampally. Again, the product mix for Mattampally to Andhra would be very, very different.

It needs to be compared. What I would say is that when we embarked on this investment for capex for Andhra, the objective was primarily to the specific fuel consumptions everything to be lower.

From 850 to 880 kcal, yeah, we could straightaway reduce it to 720, Mr. Rajesh.

That's a huge translation. From 60, 62 units up to clinker, we are already at 51 units.

We could, with the capex and successful commissioning, yeah, we could achieve much more than what we initially thought we would achieve from there.

Great. Understood.

Gradually this will narrow and the difference will remain so because of the energy mix.

Yes, sir. Again, I'm talking specific to Mattampally.

Because each unit has its own cost structure because of either raw material costs or the coal landed costs, but as it stands, we are not very far from the best in the business at Andhra.

Understood. At company level, Q4 you're looking at 500-plus EBITDA per tonne.

Is this understanding right?

Yes, sir. We are looking at 500 to 550 because we did factor some amount of price hike, but not the full one what probably is expected to because March is going to be end of the year, there could be some kind of pricing pressure.

That has been penciled in internally, sir.

Okay. Majorly would also be coming from better profitability from Andhra Cements?

I think most of it is not only from better performance from Andhra, sir, across the units, the operating leverage also is going to be better.

Yes. Understood.

Sir, second, on the land sale, what is the progress over there? Can we see some disposal happening?

Yes, sir. I think we're happy to state that there is only one step left.

Most of the other steps have already been covered. We are awaiting for the final government policy very specific onto the Andhra.

As indicated last time, I think over a year, year and a half, we should have totally monetized the Vizag land, Mr. Rajesh.

From a timeline perspective, as indicated before, we are expecting over next 18 months for the entire thing to be monetized.

Okay. Nothing can Matlab for this financial year there wouldn't be anything.

Whatever is, is FY27.

No, I don't think we expected for this financial year. It's only spread over next financial year, and I think bulk of the money we should have received over next 18 months.

Over next 18 months. Okay.

Great, sir. Thank you.

I'll come back in queue.

Thank you, Mr. Rajesh.

Yeah. Hi, good morning Mr.

Reddy and I'm from Equentis PMS. I missed this non-core money that we could realize over 18 months.

What's the total value attached to this, sir?

Good morning Mr. Jaspreet.

The government reckoner rate at this point of time is around 4 ₹4 crore per acre, sir, which roughly translates to 400. There would be some expenditure, as and also some capital gain.

We are assuming that we should receive around ₹350 crore net of the expenses that we might incur.

Okay. Net of expenses and net of tax, ₹350 crore?

Yes, sir.

This would be received in one shot, or would it be spread out in that 18 months?

No, I think the one of the advisors whose help we are taking for the monetization of this, their view is that Vizag is not such a big market for there are not many large real estate players around that place for them to absorb in single lot. Probably it should be split into 5 to 6 convenient parts so that we could monetize in that time horizon, Mr.

Jaspreet.

Okay. Ending in that 18-month window only, right?

Yes, sir. Yes, sir.

Yes, sir.

Okay. Okay.

Sorry if I'm asking if you've mentioned it multiple times in the past, but how do we plan to utilize these proceeds? Capex, deleveraging, or anything?

Yeah.

Our plan is to have a balanced and optimized debt. For next 2 to 3 years, we do not have large capex plans, most of the money should be utilized to retire the debt, Mr.

Jaspreet.

Which is at a console level about 1,600-plus, am I

right? The net debt is around ₹1,450 crore, that's what we expect by end of this financial year.

Okay. Let's say we retire this and we have some cash flow, about debt-equity then should come well closer to 0.5, let's say in a 18 to 24 months timeframe?

Yes, Mr. Jaspreet.

From our medium-term plan, our objective is to be 12 million from increasing it from 12 million to 15 million, but the capex should start somewhere around end of FY28 to early part of FY29. For the next good 2.5 to 3 years, we do not have any major large capex plan, except for the maintenance capex plan we have.

Or the ongoing capex anyhow is likely to conclude by end of next year or middle of next year, so that gives us some additional cash flows to retire the debt.

Okay. Brilliant, sir.

Thanks for giving all that inputs. All the best.

Thank you. Thank you, Mr.

Jaspreet.

Good morning, Mr. Satyam.

From a state mix perspective, for the quarter, yeah, we are at 28% in Telangana with a similar 28% in Andhra Pradesh, around 7% in Karnataka, 6% Tamil Nadu, 9% Maharashtra, 10% Odisha, 8% Madhya Pradesh, 3% Gujarat, and all the other states included at 1%, sir. Sir.

Thank you. Sir, next question would be what is the capex that we are envisaging for '26 overall as well as for '27 as well?

We did state part of our investor presentation, Mr. Satyam, but yeah, it is on slide number 12 of the investor presentation.

Since you have asked, yeah, it's around ₹303 crore for the 9 months that we have done. What we have budgeted was around 186 for the total FY26 it is around ₹489, sir.

For the coming year, what is budgeted is around 291. Understood, sir.

Thank you. Thanks.

That's it from my side. Thank you.

Yeah. Hi, sir.

I'm from Antique Stock Broking. Sorry if I missed this, but will you tell me what sort of capacity additions we are expecting by our peers in the markets that we operate in next 6 to 12 months?

We are not expecting much in next 6 months, sir. In 12 months, again, we are not expecting anything in the current financial year.

In the next, probably before the end of next financial year, we do expect Ramco's Kolimigundla line 2. Same would be the case with the line 4 of UltraTech, sir.

I may not be very precise with either it should be in the coming financial year or a quarter later which should or get into the next financial year. These are the two assets that we are looking at in AP.

Okay. Thank you.

Thank you so much, sir.

Thank you.

Hi, sir. Sir, for next year, once this 4 megawatt WHRS also starts, broadly at a console level, how one can look at in terms of the cost reduction overall?

Mr. Shravan, the only addition, or rather there are going to be two additions, I would say, or three additions.

One on the waste heat recovery, as it's a 4.35 megawatt, which should roughly translate a net saving of around ₹100 to ₹125 per tonne at Gudipadu unit, sir, up to clinkerization. We have grinding mill getting added up at Jeerabad.

We are hoping it should be in the early part of FY27, so that should help us have some operating leverage because Jeerabad is already operating close to 100%. That should, again, on a fixed cost basis, should help us save a minimum of ₹150 to ₹200 per tonne.

The Andhra grinding plant primarily would help us achieve the number of electrical units where we expect that is likely to get commissioned by August of '26, at least for half year it should be available. We expect 4 to 5 units kind of a reduction on close to a million tonne of a sale for half year, sir.

Half a million into 4 units is what we should factor. That should be around ₹25 to ₹30 crore we should expect.

Sorry, ₹50 per tonne kind of a saving is what we should expect at Andhra. Okay.

Understood. Given the current petcoke prices are there, do we see some kind of a 3%, 4% kind of a increase at a fuel cost level?

Sir, I think we did switch over from petcoke to the domestic coal in some of the assets and to the imported coal at the other assets. Our internal penciling in is that for the current financial year we don't expect any cost increase as far as power and fuel is concerned.

For the coming year, as it stands, we expect around 2% to 3% kind of an increase at the fuel price. Again, it is too soon, but we would be in a much better situation to confirm for the next financial year end of this quarter, sir.

Okay. Got it, sir.

Got it. Sir, do you see is there still any kind of M&A is still left in South?

Mr. Shravan, I have absolutely no idea about the activity about M&A because most of these M&A are very specific between a buyer and a seller.

I think it's in public domain. I have nothing to add on what is already in the public domain, sir.

Specifically, we have not seen major intensity or activity that is happening on M&A for last 6 months. We assume that for next few quarters, it might remain very similar.

Okay. Got it, sir.

Thank you.

Thank you.

Good morning, sir. This is Jyoti from Nirmal Bang Institutional Equities.

Can you hear me?

Good morning, Jyoti. How are you, ma'am?

I'm very well, sir, just that I'm a bit unwell. Can't speak much, I hope, but I'm audible.

Loud and clear, yeah.

I have two questions. One is any specific reason that we have a sudden spike in depreciation and is it likely to continue?

Second is on the finance cost also, we've had an average of almost like ₹470. This time it's ₹500, ₹103, ₹50 crore.

Is there a possibility that this will continue? Then on the fuel mix part, while I believe that transitioning from a petcoke to coal may have limited cushion there, however, what is the fuel mix?

Because the increase in the fuel cost is almost 15%. I understand the cost of petcoke was high, but still other companies were able to mitigate in some way.

Maybe first is what is the fuel mix this quarter, what was the earlier fuel mix, and what is it now in this quarter? On the finance cost and depreciation part, sir.

Good morning, Jyoti. On the depreciation front, I think we have been capitalizing all the capex that we are doing, whatever got concluded.

That actually has added up to the overall kind of a depreciation. We did give the mix over few last quarters on slide 11, Jyoti, of our investor presentation.

That should help you see how the overall kind of fuel mix that we are doing. We switched over from petcoke imported as well as Indian to the Indian coal as well as imported coal.

That is helping us mitigate as much extent as possible in terms of the overall. As mentioned, we don't expect any major fuel price increase.

Now, on a peer comparison, again, our issue is you should compare apple to apple even at the product mix. Our product mix primarily is at 55% OPC and 45% blended.

That also makes it look higher because again it's the markets that we service have a slightly higher OPC kind of orientation. That makes it look higher.

On kind of a cost, I think we should be flat for the current quarter. Going into the next year, I think we would be coming back end of this quarter, Jyoti.

What about the coal cess, that ₹400 coal cess? No,

I think that actually has made the domestic coal and imported coal lower than petcoke.

It has.

The coal price did not come down, only the cess actually helped us to mitigate the increased petcoke kind of a price to a great extent.

Because in a quarterly it is staggered by almost like ₹50, ₹55 per tonne. Hopefully we should see some value incrementally should add in quarter 4 also.

Then for full year, we should be able to see the full impact of this coal cess.

No, I think it's a mix, I would say. In our case, we probably don't have as high inventories, from that perspective, earlier we used to keep very large inventories.

Right now we are running on a quarter ahead. Earlier we used to do two quarters, now we're doing only a quarter ahead.

As it stands, we don't expect any major either cost increase or saving on the power and fuel, except for the efficiencies that we have achieved, Jyoti. Okay.

Thank you, sir.

Thank you.

Hi, sir. Sir, this is Parth from Investec.

Sir, I had a couple of questions. The first one, sir, are we accruing any incentives currently, and if yes, how much was it in the current quarter?

No, I don't think we have accrued any interest during the current quarter, sir, the incentives. Whatever we got was during the Q1 and Q2.

Nothing is due for the current quarter or the coming quarter, Mr. Parth.

Okay. Sir, one clarification, when I look at your slide number 11, the fuel pricing, right?

The current quarter's presentation versus the last quarter, when I compare the domestic coal pricing, it's quite different. The last quarter base, basically Q2, in the previous presentation it shows 1.26 for domestic coal and the current quarter it shows 1.72.

So

Because of the Singareni as-fired. It is as-fired, sir.

We would have fired most of it from Singareni at Mattampally and also got a lot of domestic coal at Jeerabad, sir, so that is the difference.

Got it. Basically we should rebase the previous quarters as well, would that be?

No, I don't think, see, it's on as-fired basis, sir. Again depends on if it is 100% Singareni coal and elsewhere we are using imported petcoke, yeah, pricing would have been that.

Now it is actually a mix of some other than Singareni domestic coal has been used at Jeerabad, so that is the reason why the prices got increased. The Singareni petcoke landed price or as-fired cost at Mattampally is sub-₹1.20, sir.

Got it. Okay.

Sir, in the base year, shouldn't it be the same? Because you've rebased in the current quarter, right?

It's on as-fired that we are giving, Mr. Parth.

It's not like we're trying to reorganize. It's the current fuel prices trends that we are indicating there.

Right. That is for the current quarter, right?

What about Q2 FY26? That's in the past, right?

Realigned based on the as-fired.

Sir, as-fired, sir, it's all realigned with as-fired.

Okay. Got it, sir.

Thank you for answering my question.

Thank you.

Prashil, we can close.

Thank you, Prashil. We would once again like to thank each one of you for taking time to join us on the call.

I hope you have got all the answers you were looking for. Please feel free to contact our team at Sagar or CDR should you need any further information or you have any further queries.

We would be more than happy to discuss them with you. Thank you, and have a good day.