Ladies and gentlemen, good day and welcome to the JK Lakshmi Cement morning conference call for the quarter and year ended 31st March 2026, hosted by PhillipCapital India Private Limited. As a reminder, the conference line will remain in listen-only mode. 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 touch-tone phone. Please note that this conference is being recorded. I will now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital India Private Limited for opening remarks. Thank you, and over to you.
Thank you, Ryan, and good evening, everyone. On behalf of PhillipCapital India Private Limited, we welcome you to the Q4 and FY 2026 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 Director, 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 made or discussed on this conference call may be forward-looking statements based on management's expectations and also some expectations to future expectations, 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.
JK Lakshmi Cement Limited and the management of the company assumes no obligation to publicly update or alter these forward-looking statements as a result of any new business development information or future event or otherwise. Also, participants can download a copy of JK Lakshmi's Q4 and FY 2026 results presentation from the company website or subscription websites. I will now hand over the floor to the management of JK Lakshmi Cement for their opening remarks, which will be thereafter followed by interaction Q&A. Thank you, and over to you, sir.
Thanks, Vaibhav . Good afternoon to everyone, and I have a little sore throat, so forgive me for some disturbance in my voice today. Anyway, I'll just start. I'll give you a brief update for the quarter and the whole year, how it looks for us and for the industry. Since we have already uploaded this quarter four performance, we'll have question and answers thereafter that. During the financial year 2025-2026, pan-India cement demand grew by about 7% to reach about 480 million tons estimated. This is an improvement over 5% YoY demand growth recorded in 2024-2025. Overall quarter four FY 2026 demand growth is estimated at about 6%-6.5%. Volume about 17% quarter- over- quarter, driven by broad-based action.
Cement demand remained strong during December 2025 till about February 2026, 8%-10% growth, but moderated during March, which is estimated at around 5% due to weak sentiment amid Middle East conflict. Supply side witnessed highest-ever annual capacity addition of 64 million tons and national effective installed capacity reaching now to 712 million tons at the end of March 2026. The highest capacity was added in the East, followed by North, South, and Central India. West added the lowest capacity during the financial year. This led to an adverse impact on the overall demand-supply situation, with pan-India capacity utilization estimated to be at around 69% and marginally lower than previous years. On the pricing side, cement prices witnessed partial recovery, particularly in non-trade segment during quarter four FY 2025-2026. On a quarter-over-quarter basis after slipping beyond GST pass-through level in the preceding quarter, which is around 22nd September 2025.
Substantial capacity addition during the financial year 2025-2026 and increased competition restricted meaningful price hikes. It will cause surge sharply because of this geopolitical situation. Pet coke prices up by about 40% quarter-over-quarter to around $160 per ton level, and that is again quite fluctuating. Coke prices also went up by about 30% quarter-over-quarter. Operating costs likely to decline in the last quarter for the entire industry due to operating leverage and stable freight and input costs. Limited price hike constrained marginal expansion despite cost efficiency. On the outlook part of it, what we see volume growth during FY 2025-2026 was driven by, of course, housing demand, infrastructure, and is likely to remain in the range of about 5.5%-6% or 6.5%. This is what our estimation is. Cement demand outlook suggests slowdown with pricing power staying weak despite sector consolidation.
Energy costs are expected to rise by about at least INR 300 and packaging cost about INR 80- INR 100 per ton. That is going to impact maybe in upcoming quarters because of the geopolitical situation. If the Middle East conflict is sustained for a longer period of time, then operational expenditure may go up even more than that. Capacity addition may slow down. This is what we see in the backdrop of restricted capacities. Investment continue on efficiency improvement trajectory coupled with Go Green focus. Sustainability agenda in focus with key initiatives spanning renewable energy, fuel thermal substitution, emission reduction, and EV deployment is talk of the day . AI and digital deployment is also emerging as a key lever of productivity and efficiency improvement. Overall, we see that FY 2026-2027, cement demand is likely to grow at about 6% or so.
This is what just a brief top line of the industry for the whole year and quarter, and this is what we think as of today. Since we have already updated our results, that is there with you. Now we can have questions and answers over that. Thank you so much.
Thank you. Ladies and gentlemen, we will now begin the question- and- answer session. Anyone who wishes to ask a question, please press star then one on your touch-tone telephone. If you wish to remove yourself from the question queue, you may press star then two. Questions are requested to use their handset while asking a question. Ladies and gentlemen, we will wait for a moment while the questions queue assembles . The first question from the line of Sanjeev Kumar Singh from Motilal Oswal Financial Services Limited. Please go ahead.
Thank you for the opportunity, sir. Two questions. You spoke about the likely capacity addition in FY 2026. What is the capacity addition in your view, and going forward in FY 2027, 2028, what sort of capacity addition are we talking?
2026, 2027 estimated to be about, again, estimation. Our estimation is about around 45 million- 50 million tons. Last year it was about 64 million tons. This is the cement capacity. Now we have to apply that clinker factor, whatever clinker factor is there on an all India basis. Which is maybe about 1.6 or so.
Standing capacity again. Currently, we have about INR 300 kind of a cost increase. My view is that suddenly we will see INR 150, INR 160 in 1Q , and then rest will be in 2Q . What sort of price increases have they just taken so far? Also if there any change on demand which has been seen in the month of April and May?
April demand was better. May, when we started, there was sluggishness because of the reason, because typically wherever we operate, I think labourers had gone to their respective places for election. There was some delay on account of their coming back. So that impacted demand to an extent initially. But I see little better demand 15th May onwards. So April was better. May initially it was sluggish because of combination of reasons. Of course, I think there was a big uncertainty around this geopolitical conflict also. That has got rubber pick up on the cement industry as well. But May 15th onward, I see a little bit green shoot in demand in the month of May.
Anything on price increases?
Price increase, as I mentioned initially, there was some price increase in non-trade segment in various areas. There is some trade price increase also. But as I said that those price increases are not at all kind of commensurating with the cost increase which we are facing.
Okay. Thank you.
Thank you.
Ladies and gentlemen, if you wish to ask a question, please press star then one. The next question from the line of Omkar Rane from Emkay Global Financial Services. Go ahead.
Good evening. This is Harsh here . My first question on the realization. Last quarter you said that the realization fell 10% sequentially due to the adverse product mix and the ramp-up of the Surat plant . Hello?
Yes.
Yes. Last quarter there was in quarter four, there was a kind of ramp up in capacity taking in the non-bagged category and we made a share in the non-bagged segment. Why was our realization just 1% growth ? Why not higher? This is my first question.
So just to give you, again, our estimate. There are different level of price increases in different part of India. And perhaps our geography, the price increase was little lower than other zone, and particularly I am talking of East. East also, we have a limited presence in Chhattisgarh , which perhaps is the least priced zone in entire East. And in western part of India, Gujarat, initially I think there were no price increases, but I think I see a little bit of improvement in demand and prices are also going up now. So I think our footprint wherever we operate like North, West and a very small part of East, the meaningful price increase was not there. And that is why price or NSR increase is about around 1%. It is just based on the geo footprint which we have. Which is little different than those players who are there in the industry.
Got it. Second question then. On the AMDCL, cancellation of our AMDCL sale contract. We have reported INR 130 crore in other noncurrent assets. Just wanted to know, sir, what is the surety or the certainty of receipt of this or recovery of this cash in July, basically, whenever there is a hearing in the High Court. How sure are you?
We are not saying that it will come in July. We are saying that the case will be in July. [audio distortion] I do not know when it will come, but we are sure it will. That is why we are sure that it is recoverable.
Last question, sir. What is the clinker production in 2026 and CC ratio?
Sorry?
Clinker production, yes.
92.26 lakh tonne.
Sorry, sir, you are not audible. Can you repeat?
92.26 lakh tonne.
Oh, got you. Thank you.
Thank you. Please press star and one to ask a question. We take the next question from the line of [Shashank Goel from Vyomara]. Please go ahead.
Thank you so much, sir. I also have a couple of questions. My first question is after the Durg expansion , what is the next project we are looking to take up?
Come again, I think. Once again, come again.
After the Durg expansion.
[audio distortion]
Sorry, sir, your voice is lagging.
We are going to take Assam project after East expansion.
Oh, okay. In terms of ramp-up, are we on track to achieve that 30 MT guidance for 2030? Will we be adding 9 MT of capacity over FY 2027 after the Durg project?
We are reasonably confident that we will achieve 30 million tons by 2030. Our ongoing projects in East, they are well on track. We are confident that we are going to achieve that.
Both [audio distortion] the 30 MT and 9 MT addition?
No, your voice is not clear.
Hello. Actually, I was asking that will adding 9 MT of capacity over FY 2027-2030 after the Durg project.
No, sorry, your voice is not so clear.
[audio distortion]
Shashank , if you please use your headset and ask the question.
Hello.
Yeah, go ahead. I think you are breaking.
Will we be adding 9 MT of capacity over FY 2027-2030 after the Durg project?
Yeah, after Durg project only. Yeah.
Yeah. Okay. Thank you. Thank you so much.
Thank you. Please press star and one to ask a question. We will take the next question from the line of Dhruv Sitlani from EverFlow Partners. Please go ahead.
Thank you for the opportunity and congratulations on the good results. I have a couple of questions. My first question is that in the Q4, as one of the participants mentioned, that company de-recognized some crores of investment in Assam following the cancellation of the mining license. We heard the limestone mine was a critical Assam project planned. Can the management clarify on this? Also, is the Assam integrated plant still viable? Are you actively pursuing an alternative limestone source, or has a plan been devised to a blending unit that would source clinker externally? What does this mean for the FY 2029-2030 timelines and the earlier indicated 2-2.5 MTPA capacity target?
You see, earlier the AMDCL had granted that MDO contract to the consortium, which was canceled subsequently. But out of the three mines, we were able to get two mines under the auction route in JK Lakshmi. Based on these two mines, which have reserves of about 250 million tonnes, we are pursuing our Northeast foray, which will come after the [audio distortion].
Okay. That was really helpful. My second question is, are ramp-up and utilization from our new capacities in Surat has been quite slow ? What have been the factors for it? And by when do we expect utilization to reach regional averages?
The ramp-up is well on track. In fact, we commissioned around the end of September, 22nd September 2025, and we are utilizing capacity more than 60% already. We are well ahead of ramp-up plan of about 18- 24 months. Probably, I think we will reach even higher capacity this year, maybe 70%+ .
Okay, sir. Thank you. That was all from my side.
Thank you.
Thank you. Please press star and one to ask a question. We take the next question from the line of Prateek Kumar from Jefferies. Please go ahead.
Good evening, sir. My question is on your CapEx. Last two years, CapEx has been INR 650 crore-INR 700 crore, with large CapEx commissioning with over INR 4,000 crore kind of CapEx for the ongoing East expansion. How do you look at CapEx for FY 2027 and FY 2028?
These next two years will be quite high CapEx. FY 2027, we are on INR 1,600 crore-INR 1,700 crore and close to INR 2,000 crore in the next year when we would be also taking up the. We already started, but it will ramp up the land acquisition and the projects in Kutch and Nagaur.
And time lines of East expansion , can you repeat that again?
We are expecting the Durg first to come by FY 2028 towards the end of that year, FY 2028. One year later, the Northeast project should also be there, and followed by the greenfield thereafter.
Sorry, Durg clinker c oming in FY 2028 and the other three grinding units, about when?
This is Durg including the grinding units.
Okay. Durg plus grinding units, FY 2028 end, and FY 2029, we are missing Northeast clinker.
Yeah. Clinker and grinding together.
Is it 1 million ton each, right?
We have not finalized, but we will do that maybe around slightly higher than 1.5 million tonnes . Thereafter, the Kutch and Nagaur in that order. Kutch will come earlier than Nagaur because Nagaur there are issues with the land acquisition, so it is taking time. Kutch will get the priority. That will come ahead of Nagaur.
And in Nagaur, in fact, additional issue is of Aravalli zone . Until and unless that Supreme Court decision comes, I think that is why there is some delay on Nagaur part of it. But Kutch is going to be well before.
Kutch, Nagaur is a FY 2030 onwards capacity, right? 20 30-2035.
No, FY 2030.
Kutch is for sure FY 2030.
FY 2030.
Sure. Another question on, I see you exited this year. Last year, two years, we were at like close to INR 1,000. This year we have exited at like INR 750 odd in terms of our EBITDA. There are different specials this year and pricing fee that might happen. How are you looking at profitability for the full year versus last year targets of INR 1,000 per ton, which you had mentioned earlier?
INR 1,000 per ton is of course the anchor, but if you really look at cement EBITDA or even other leaders also, that has also gone down. Definitely, I think our ambition is to reach INR 2,000 EBITDA. But definitely, we have been bridging our gap up with leaders in the last couple of years, and that journey is continuing. For that, we are taking lot of measures which are internally controlled. I think I have said all those levers even before. Major levers are, of course, I think on top-line part of it. I think last year, if you see our volume growth and even premium product, that has been at a good level. Despite volume growth, I think our volume growth in premium product is also good. We are working on logistics. We are extremely focused on renewable energy.
We have closed at 46% of renewable energy. We do have plan to go even beyond. That is another lever. Digital is also being deployed in our manufacturing units, particularly in the pyro process and grinding units, where we are deploying digital AI/ML capabilities and enabling them operations to have AI/ML deployment, which is going to help us to improve efficiency and reduce costs. All those actions are already there, and we are relentlessly working on that. That remains that. At all, we have not differed from that. Whatever bridging of the gap which we have been able to do in the last couple of years, majorly goes to all those internal actions and efficiency levers we have worked on. That is going to continue in coming months and coming years also.
You definitely are going to see that our gap is going to further reduce with leaders in this FY 2027, and I am sure that it is going to reduce at least by another INR 50- INR 75, for sure.
But some of your investors have reported like INR 1,150, INR 1,250, INR 1,000. Which year are we comparing to? The gaps seem to be high this quarter versus last year fourth quarter.
We are looking at gray cement data because some other cement manufacturers, they do have portfolio of other businesses also within that. But if we compare ourselves with gray EBITDA, then we are very much there. I am sure that all of you must be doing that calculation as well. I am in touch with some of you, and we get that analysis done externally also. If you look at that figure, then we are very much there, that is within our radar. That gives us confidence that we are in the right direction and that gap is going to get reduced even further. So just compare gray cement versus gray cement because we do not have other than gray cement as of now. Another thing, I think incentive also we only kind of factor when we realize that. We do not keep incentive on actual basis. That is also one of the differences.
Thank you.
Please 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.
Hi, good evening to the team. Sir, my first question was a housekeeping one. Could you share the non-cement revenue and the RMC revenue for this quarter?
Yes, sir, very much. Non-cement revenue was-
Is INR 169 crore.
INR 169 crore.
Okay. RMC?
Sorry.
RMC revenues.
INR 82 crore.
INR 82 crore. Okay. Coming to the CapEx plan which you have outlined, which gives you INR 1,700 crore this year and INR 2,000 crore for next year. If I do the calculation based on the cash pressure and all the industry is reeling through, I see your net debt increasing by at least INR 1,500 crore over the next two years. So that would shoot up your net debt level significantly. How do you plan to manage that? Second question, you are among the lowest cost quartile, operating cost level. I believe if I do a line by line, matching your numbers with UltraTech, you are better off in terms of fuel cost. You have a highest share of green power. Your logistics costs are only slightly similar. Your overall costs are comparable to UltraTech's operating costs.
The margin is different and obviously the difference is on the realization. Even trade mix, both the companies are. You are slightly off versus their numbers in terms of trade. What we understand is there is a sharp gap of INR 400- INR 500, and that is what is. Where I am coming from, that you may have limited headroom now available on your costing front to squeeze your cost further. What efforts are we doing to increase our price premium or price positioning, whereby the margins can sustainably move north of INR 700, INR 800?
[audio distortion]
We cannot hear anything, sir. Hello.
Am I audible? I think there is some disturbance.
Yeah, now you are audible, sir. Please tell me.
Rajesh, as I mentioned before, I think this is a focus area for us. How we are going to raise our pricing level compared to our competitors in the market. This has been areas and we have worked that past three years. We are going to work on improving our pricing. For that, we do have that pricing treatment and also in the market. In the sense, we have rejuvenated our legacy brand, launched Green+. That was the whole idea to improve our pricing. If you improve JK Lakshmi Cement, really competing with even UltraTech in the market. To improve upon the brand. More and above now we do have ambition of, we have already launched LC3, what we call in Limestone Calcined Clay. How we are going to ramp that volume up, that is also a plan for us. It is not only a green cement.
It is as good as [binary porter levels]. We are working on that as well as how we are going to get better volume from LC3 at the right price. The strategy there, Rajesh, is right product, right price and right market. I do feel that we should be able to further improve.
On the net debt, sir. Given the large CapEx you are planning for next two years.
Yeah. It will peak out, you are right. There will be an improvement also. That once we recover from, because that is the output kept in the additionally better from the Durg extension. The moment it opens, that will go back to the normal.
Okay. Sir, just on the, when you mentioned the clinker volume. Of course, we see the clinker utilization in FY 2026 is close to 93%. For next two years, given that your Durg expansion will be back ended in FY 2028 end. For next two years, are we looking at sub- 50% volume CAGR? CAGR, I am talking. If you deliver 5%-6% volume growth this year, chances of a flattish volume of take we expect in FY 2028?
We are going to grow higher than the industry in FY 2027 and there are reasons for that. One, as I said that we have reached about 60%+ capacity utilization in Surat, which we are going to ramp up. One. Second, Udaipur, that capacity utilization we need to take it up. Second and third, we have that headroom in Cuttack as well. These are the areas or the plants where we do have that headroom to grow this year at least as an industry.
Are you looking to purchase clinker externally, sir? Because at 93% utilization, suppose we expect industry to grow at 7%-8%, would we have enough clinker to support that growth?
I think we do have enough clinker [audio distortion]
Ladies and gentlemen, we have lost the line of the management. Please stay connected while I reconnect the management. Thank you. Ladies and gentlemen, we have the management line reconnected. Rajesh, if you could please repeat your question for the management. Thank you.
Yeah. Same question, sir. In terms of clinker availability, given that we are already operating at 93% utilization, and given if the industry grows at, say, 7% odd, and if we are targeting 8%, 10% growth, how would that be achieved?
Even if we take, let's say, current cement mix which we have, Rajesh, we'll go beyond 14 million tonne, around 14.2 million tonne. Right? With the same level of capacity utilization of clinker. If I improve blended cement ratio, which was 62% last year, if I take to 65% and 94% of clinker utilization to around, let's say, 97%, 98%, and clinker which we have sold last year, close to about 6, 7 lakh tonne, 7.5 lakh tonne, then we do have that enough capacity to grow at that rate. These four things. One, improvement in blended ratio. Second-
Your voice is breaking up again.
Sorry, I think there is some. Am I audible?
You are audible, but in between it's breaking up.
Sorry for that. These are the three things. Blended ratio, further improving clinker utilization, 94% to, let's say, 97%, 98%. And the clinker which we have sold last year, about 7.5 lakh tonne. I think we are there. We have calculated, and we are there to grow at 10%.
Understood. Lastly, if you could share the Q4 clinker volumes.
Yeah. Just a sec. Clinker production was 24.72 lakh tonne.
Clinker sale in this quarter?
Clinker sale was 2.2 lakh tonne.
2.2 lakh tonne. That is all from my end, sir. Thank you. Wish you all the best.
Any question you can come back to me after. Thank you so much.
Thank you. Please press star and one to ask your question. I will take the next question from the line of Pradeep Kumar from Mittal Consulting . Please go ahead.
Thank you very much. My question is on the NECEM recognition update after acquiring about 80% of the share off market. What is the latest status of the liability settlement? Has the liability been settled and promoters got paid?
Can you repeat your question? It is not clear, please. The voices are very feeble.
My question is on the latest update on the NECEM acquisition in Northeast . Where the transaction was supposed to be closed by the end of March, where 80% of the shares were acquired in off market. What is the latest on the settlement of the NECEM liability and [audio distortion]
You see, this transaction was consummated at a total consideration, as we mentioned, of about INR 19 crore and takeover of certain past liabilities. Those past liabilities have been settled in the month of March at a figure of around INR 12.5 crore. That is first part. Second, regarding out of INR 19 crore, which was the consideration broken up into two, three parts, we have paid about INR 1.5 crore towards the acquisition of shares. The other part, which is the non-compete fees of about INR 10 crore, gets paid after the entire transaction gets consummated. Additional, about INR 7.5 crore is required to be injected as capital into the company, out of which we have done about INR 3.5 crore. So we are hopeful that this transaction will in entirety get completed in this quarter only.
Most important was the settlement of the liabilities which were taken over. That has been settled at INR 12.5 crore in the month of March.
Thank you very much. That is it.
Thank you.
Thank you. This is a final reminder for the question- and- answer session, and no further extensions will be announced. Participants who ask a question, please press star and one. We take the next question from the line of Nilesh Sharma from Anantnath Skycon Private Limited . Please go ahead.
Thank you, sir. Thank you so much. I just wanted to understand, what is the current operational capacity as of now? For this financial year, how much capacity we can expect that will be operationalized?
We have current capacity of about 18 million. Last year, capacity utilization was 73%. As I said before, in the month of September, we added 1.35 million. This is why the full year capacity last year was only 17.7 million. This is what the capacity is here.
Is this the capacity that we are going to add in this financial year as well?
This financial year, no. [audio distortion] This year, we do not have any capacity at all.
Okay. How much better pattern we are expecting in this year, considering all this pickup in the work, et cetera?
I think quite uncertain. I think maybe next quarter I will update you. Just give me another quarter, because I think that depends on lot of external environment which is beyond our control. But definitely, I think we will do better than industry in terms of all parameters. That we are confident about.
Okay. Although you have given the answer, you are still targeting 30 million tonnes for 2030. Is it right, or we are planning to increase this target or reduce it?
We are on course.
Interesting. Thank you, sir. We will meet in next conference call any other time.
Thank you. We take the next question from line of Akshay Shetty from Mirae Asset Sharekhan. Please go ahead.
Good evening, sir. Thank you for taking my question. I wanted to know, given the elevated fuel cost and rupee depreciation, how do you see input cost trending over the coming quarters, and what would be the impact on margins? Also, would the recent price hikes be sufficient to offset this cost pressure? Additionally, I wanted what demand trends have you observed in April and May across your key markets?
Yeah. I will just answer one by one, because you combined two, three questions together. First, on cost part of it, just to let you know that we were dependent on imported coal and petcoke from outside in north part of India. East, I think we do have fuel which is indigenous, so these two we do not have much of an impact, excepting maybe your explosive cost, pack cost that has gone up. But north part also, we have done quite a bit to kind of contain our cost increase by changing the fuel mix. We are kind of changing the proportion of petcoke versus coal in our northern plant also. That way, we are going to mitigate the cost increase to an extent which is coming on account of imported coal and petcoke. That is one thing which we are doing.
Even if that impact is going to be higher, we will try to mitigate it to an extent by changing the fuel mix in our northern plant. If you look at last quarter, we had this fuel cost of about INR 1.58.
INR 1.54.
INR 1.54. I think this will definitely go up despite our effort to change the fuel mix. This is one of the mitigating measures we are taking just to preserve our margin to an extent. Second also, you asked about our core markets. I think overall India is a growth of about estimated growth of 6%. Our markets are also going to grow in the similar line. Maybe I think geographical, here and there some purchases here and there would be there, but as I said before, we will grow at a higher rate than industry, which is estimated to be growing at 6%. Just to summarize your answers, one action is to mitigate the cost increase to an extent by changing the fuel mix.
Second, of course, I think working on some of the levers to further mitigate that impact and typically on top line by which I mentioned blended cement, maybe trade percentage, working right product, right market, right price. Those things we are going to take. On growth part of it, definitely I think we will grow similar line and even a shade better than industry.
Yeah, thank you. That was very useful.
Thank you so much.
Thank you, Akshay. We take the next question from line of Parth Bhavsar from Investec . Parth, please go ahead. Parth, please unmute your line and proceed with your question.
[audio distortion]
Please use your handset to ask the question.
I am here. Hello.
Yeah.
Sir, I have a couple of questions. I have a couple of questions on our costs. Sir, you guided for an INR 300 per ton sort of a number increase on energy cost, and it increased to INR 200. What sort of numbers will we see in Q1? Will the hit be entirely in Q1? How much can we mitigate through our cost measures?
What I see maybe the INR 300 impact would come somewhere around quarter two, but this quarter definitely I see somewhere around maybe INR 100- INR 120 or INR 130 per ton.
Versus the INR 400 per ton that we are guiding, including packaging and energy, right?
Yeah.
Okay. Sir, how much of this, again, INR 120 per ton sort of a number we are seeing a [inaudible] in Q1. Maybe then how sort of price increases has the market absorbed till now?
As I said before, non-fuel prices have gone up in various markets. Trade prices are also inching up, but not to that extent. Once now demand I see is getting better. As I said that May beginning was a bit sluggish. I see a little better demand in latter part of May, and probably now since demand is improving, prices also will inch up even in trade segment also. Trade non-fuel prices also will go up, and I'm confident that since demand will support, we'll be able to recover or pass on majority of the costing things which we are going to have. This is what I foresee as of today. But that depends on a lot of external factors, right? How demand behaves and how competitive intensity is also. That depends on a lot of things, but this is what my fair estimation is.
Fair enough. Sir, would we have blended mix in Q4 and FY 2026?
Yeah. Blended was 62%.
Okay, and for 2026?
62%.
Okay. Those are my questions. Thank you so much.
Thank you, sir.
We will take some questions from the line of Shravan Shah f rom Dolat Capital. Please go ahead.
Hi, sir. I have a couple of questions. One is out of curiosity or maybe a request. Sir, do you have any kind of a problem with me? Because I feel, or maybe the organizer is allowing or maybe not allowing at the end of the call to ask the questions. If you wish that I do not ask the questions, sir, I do not mind. So just-
No, sir. Sorry, sir, if you are getting that impression. Please, I think, ask as many questions you want. I will invite you to come to my office, or else I will come to you and meet you, sir. You are most welcome.
I would love to meet you, sir.
Yeah. Please do that. Let's meet as early as possible. Because I get lot of insights from you. That really helps me.
Yeah. Thank you, sir. A couple of questions. Most of things has been covered. Just continuing previous past questions. Broadly understanding Q1, if we see INR 120, INR 130 cost and maybe INR 60, INR 70, maybe INR 30, INR 50 kind of an answer from operating deleverage. Maybe INR 80 kind of an EBITDA reduction broadly at current level. That's the way one can look at?
Shravan Ji , as I said, I think that depends on a lot of things. Maybe I think, if demand supports, then I think we'll be able to recover whole cost increase also. We're not too sure about it. Very difficult to really give an estimation. But broadly, we think that, yes, we have not been able to increase our prices to the extent cost has gone up. If demand supports, then maybe I think we'll be able to recover also. So we're not sure as of today, but what we are focused as of now at JK Lakshmi Cement is to work on all those things which we have control over, and which I said couple of things which we are working on. Like, to mitigate the cost, Shravan, we are working on a fuel mix in our north plant.
We are working on further improving our renewable energy and improving CSR and all those low-cost fuel. Those actions we have already started taking. Our focus is to really work on all those things which we can control, and let's see, if things go all right, then maybe I think we will be even better.
Got it. Sir, a couple of data points of non-cement margin would be for the quarter would be how much? 4-odd percent ?
4%. You are right. You are absolutely right.
The AAC block revenue would be INR 58 crore, INR 60-odd crore for this quarter?
Shravan, you are absolutely on the dot, INR 59 crore.
Okay. I just wanted to know, this Durg INR 3,000 crore CapEx that the total we have , out of that, how much we have already have done by FY 2026 by March and how much already spent?
We have done about close to about INR 500 crore.
Okay. INR 500 crore is done. Roughly if-
Including the railway trading.
Yeah. Roughly how is it looking? Obviously, we will still be finalizing in terms of the capacity for the Assam. Roughly, sir, I have to look at, sir, this and for maybe by FY 2029 now we are seeing FY 2030, obviously, the Nagaur will depend. Broadly, if I leave apart the Nagaur, how much we need to spend by FY 2029? Broader number, just wanted to understand.
Yeah, as I mentioned in response to earlier question, FY 2027, we are seeing about INR 1,500-INR 1,700 crore of CapEx. Then INR 2,000 crore at least in FY 2028. Maybe INR 1,000-INR 1,500 in FY 2029.
Okay. And, sir, just one thing, intangible assets which was INR 329 odd crore in FY 2025 and for now it is just INR 5 odd crore. [audio distortion]
Which asset you are talking of?
In balance sheet, intangible assets, sir, which we have. So that was in consolidated, it was INR 329 odd crore was there. Which is now is just INR 5 odd crore. So just wanted to know.
Because you would have read in our notes, we have in the consolidated results, we have de-recognized the mining rights because of the cancellation of the [audio distortion]
Okay. That's the one.
INR 325 crore gets knocked off. That's how INR 329 goes down to INR 5 crore. That is appearing in the note.
Oh, yeah. Lastly, sir, two data points, sir. CC ratio for fourth quarter, and power cost, would it be the similar 5.37 per kilowatt for fourth quarter?
CC ratio, Shravan, is 1.44. What is the next question?
Power cost for fourth quarter. INR 5.37 was in third quarter.
INR 5.79.
INR 5.79. Okay. Thank you, and all the best.
Thank you, Shravan. Thank you so much.
Thank you.
We'll take the last question from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Hello, am I audible?
Yes.
Yeah, I think you mentioned on the Durg project, INR 3,000 crore. Till FY 2026 end, we have incurred INR 500 crore. Is this understanding correct?
Yeah.
Okay. And, sir, if you just look at the Durg project CapEx, for next two years, how would that be phased out in terms of CapEx outgo?
As I mentioned, including the land acquisition and also the Northeast project together, we have talked of INR 1,500 crore-INR 1,700 crore in response to your earlier question, and INR 2,000 in FY 2028.
No, I just wanted to understand, even if you want to delay the Northeast project and prioritize the Durg project, in that case, how that number would look like?
Sorry, we will not delay.
Okay. Will not be delaying. Okay. And sir, this Sirohi TSR project, by when is that expected up?
TSR, I think phase one is over. Phase two, we have not yet taken up because the availability of alternate fuel is not that great around that plant. Yeah. Right now, I think we just have phase one we have completed. Phase two also we are contemplating, but we have not yet finalized.
Okay. And the railway side in Durg second phase, sir, is that work going on that?
I think we are dependent on lot of other agencies. Like we have to pick up one flyover, and that passes through one PWD road. That we have to really get it done through them only. So there is delay from their end. And another one is strengthening this existing track. It again with the Steel Authority of India Limited. So once they are kind of ready, then I think that will get done. Nevertheless, I think our operation is going on full swing. There is no issue on that. So once they are kind of ready with all those things, then we kind of do that. There is no delay from our end.
Understood. And sir, this non-cement revenues, there were earlier targets of growing this at 20%-25% CAGR, but last two years we are seeing around 10% revenue CAGR. So any thought on that? So why we are not aggressive in this segment, the non-cement revenues?
Non-cement revenue, you're talking, Rajesh?
Yeah. Non-cement revenue, sir.
I think we are going as per plan. Yes, I think ready mix plant which we wanted to set up, I think we are little behind our projections. But in AAC block area, AAC area, I think we are kind of as per the plan we are growing. In other products like plastering solution, tile adhesive, we are growing well, I think, and with a high margin. Though I think revenue wise you will not find that much, but I think that gives a decent margin. Here, I think we are as per plan only.
Ready mix has not gone as per the plan, and the reason was also because we want to grow in the area where we have our cement footprint. The fact, like, ready mix, you have got margins also on lower side. We focus on other than RMC so that we get better margin. I think revenue wise, we are little lower. That was a very conscious and deliberate call.
Understood. Sir, lastly, when you talked about the Q1 outlook, and you said that April was good, May started off on a weak note. So overall for the quarter, what sort of growth you are looking at sub-5% given that the market has been subdued, and cost pressure you are looking at close to INR 150 since Q1 QoQ, and around INR 60- INR 70 cost pass-through expected. Is this understanding correct?
Growth-wise, Rajesh, I think though I think May initial was little sluggish, but overall, I think April, June is going to be better, and we will grow in alignment with the projections. So I do not see it going to be an issue in terms of growth. Right?
How much -- yes, yes, please go ahead, sir.
Yeah. INR 120-INR 130 ton. So that impact will come in this quarter, but next quarter, I think impact is going to be even bigger. The whole idea is if demand picks up in perhaps, I think we'll try to recover this from the market. But I suppose that now demand is little looking up going forward. But I think you do have other challenges also because of petrol and diesel hike. That is another element which is coming now into fold. And that is going to impact our logistics cost. If you add that, because in the last maybe a week or so, you have already seen like about INR 4 per liter increase. That comes to about, let's say, INR 15- INR 16 a ton, if you really
Okay. Yes.
Yeah.
That's-
Let's wait for some time because cost and the other external scenario is so volatile, it's very difficult to really kind of calculate as to what is going to happen and how much you will be able to pass on.
No, I just want to checking if this few months till May, have you been able to effectively pass on the cost increases? Or that has been still optimal?
April, I think thanks to our inventory also, at least we have been able to do that. In April.
Understood. That's all from my end. All the best, sir. Thank you.
Rajesh, thank you so much.
Thank you. 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.
Sir, just a couple of quick questions. One thing, you said on the call INR 120 of unpassed of inflation expected in Q1. You are adjusting for the price increase, if any, right? I just want to confirm. You said INR 150-
You said INR 150 would be the expected cost inflation in Q1. That is what you indicated in terms of the cost inflation for the current quarter. You are not adjusting this for any price increase which potentially will be passed on or which has already been passed on, which is rolled back. It is only the cost inflation, right? One question. It is only the cost inflation number you are saying.
It is cost inflation, purely cost inflation, I think. Right.
Okay. Sir.
Yeah. No, go ahead.
No, please continue, sir. Please continue.
No, I am through, I think.
Okay. Second question, sir, was that we recently got to know that you have now partnered with some manufacturers for iron rods, et cetera. JK Lakshmi steel rods, et cetera, also been like marketed in, sold in the market. What was the management broad thought process? Are you going to get into building multiple products like, switching with further more, anything more in the ambient? What is the management thought process of getting into newer product lines, and what is the kind of income which you are expecting from all these businesses?
Vaibhav , I think first I need to correct you. We are not at all going into iron ore area. Right?
No, the steel rods, I am saying.
I think we are piloting it because if you really look at distribution network of all those products like TMT and all. That has quite a synergy with cement channel network. The idea was, can we leverage our brand strength? We are not at all going into manufacturing. We are not at all going into distribution. We just wanted to just pilot it, if at all we can leverage that brand strength which we have in different markets. That is at a very, I would say, nascent stage, very initial stage. I will not be able to comment on timeline.
What is the management thought process also to get into more products like this? Or this is only after testing of this product only you will take a final call as to what needs to be done.
Definitely our effort or our thought. The strategy is to go to adjacent building materials for sure. Because that, we want to give our customers portfolio of product. We definitely want to go into adjacent building material, and you see that tile adhesives, plastering solution which we gave, and then AAC block, RMC. I think all these adjacent product only. It is being used in building materials. So definitely, I think our, not only you do have n number of other products also, which we may explore in future. But yeah, strategy-wise, we do have that thought.
Got it. So that's what I wanted to know. Second thing, sir, I just made sure you have tied up with some manufacturers and you are just lending your brand and charging a royalty in terms of brand fees. That's what I was assuming. Okay. Thank you, sir. That's all from my end. On behalf of PhillipCapital India Private Limited, I thank the management of JK Lakshmi Cement for the call and also many thanks to the participants for joining the call. Thank you very much, sir. Ryan, you may now conclude the call. Thank you.
Thank you.
Thank you. On behalf of PhillipCapital India Private Limited, this concludes this conference call. Thanks for joining us. You can now disconnect your lines.