Ladies and gentlemen, good day, and welcome to the earnings conference call of JK Lakshmi Cement Limited, quarter and nine months ended 31st December 2025, hosted by PhillipCapital (India) Private Limited . As a reminder, all participant lines will remain in the listen only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call, please signal the operator by pressing Star then Zero on your touchtone telephone. Please note that this conference is being recorded. I will now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital (India) Private Limited . for opening remarks. Thank you, and over to you, Vaibhav.
Thank you, Ryan, and good evening, everyone. On behalf of PhillipCapital (India) Private Limited , we welcome you to the Q3 and nine months FY 2025 call of JK Lakshmi Cement Limited. On the call we have with us Mr. Arun Kumar Shukla, the President and Director, and Mr. Sudhir Bidkar, Executive Director of Corporate Affairs and CFO at JK Lakshmi Cement Limited. I would like to mention on behalf of JK Lakshmi Cement Limited and its management that certain statements that we made or discussed on this conference call may be forward-looking statements related to future developments, and such statements may be based on current management expectations. These 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 the statements made.
JK Lakshmi Cement Limited and the management of the company assumes no obligation to publicly update or alter these forward-looking statements, whether as a result of new information or future events or otherwise. Also, JK Lakshmi Cement Limited has uploaded a copy of the Q3 FY 2026 results presentation on the company website, which participants can download. I will now hand over the call to the management of JK Lakshmi Cement for their opening remarks, which will be followed by interactive Q&A. Thank you and over to you, Arun, sir.
Vaibhav, thank you so much. Good afternoon to all of you, and welcome to this call of JK Lakshmi Cement, quarter three and nine months of financial year 2025-2026. We have already uploaded the presentations, and we can right away start with questions and answers.
Thank you. Ladies and gentlemen, we will now begin with the question -and -answer session. Anyone who wishes to ask a question may press Star and One on their touchtone telephone. If you wish to remove yourself from the question queue, you may press Star and Two. Participants are requested to use their handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We take the first question from the line of Pathanjali Srinivasan from Sundaram Mutual Fund. Please go ahead.
Thank you for the opportunity. A couple of questions. Firstly-
Pathanjali, I am sorry to interrupt you there, but your audio is not coming through clearly. Could you please use your handset?
Yeah. I hope it is better now.
It is better, thanks.
Hello? Hello?
Please go ahead.
Yeah. I believe your share of trade sales has fallen quite a bit on a year-on-year basis. Could you explain a bit about this in terms of why this has happened?
I think not very clear. Sorry. I am extremely sorry, but I could not really hear that.
Am I audible now? Can you hear me?
Now it is little better. Not so great, but yeah, we can manage.
Okay. Your trade sales in your overall volume has declined quite a bit year-on-year basis. Can you tell us what has happened here?
What? Not clear. Sorry, sir. Sorry.
Mr. Srinivasan, if you could please use your handset and ask your question.
Yeah. Just a second. Your trade share has fallen quite a bit on a quarter-on-quarter basis in your overall volume trade cement sales. Can you explain why this has happened?
Yeah. Good. Now it's clear. You're asking about trade sales drop, right? Yeah. That has happened in quarter three of this year. This is precisely because of two things. One, of course, I think our volume in Gujarat has gone up. Whatever we sell in Gujarat, in quarter three, we have sold more than that. This is one. Second, that is also coming from the fact that we commissioned our Surat grinding station in the month of September, 22nd September 2025. That volume was also available with us, and there was a good demand in Gujarat beyond 15th November. So our volume went up in Gujarat, which is predominantly a non-trade market, and that is why our trade share has gone down by about 4%, right?
Yes.
53% - 59%. 49%, sorry. This is what the reason is.
Why would our trade volumes on a year-on-year basis decline? I get the fact that your non-trade has gone up because you got more business, but why is there a decline in volume for trade year-on-year?
Trade also, if you really see, post GST reduction on 22nd September, there was some confusion in the market with respect to passing on prices to customers and things like that. In fact, prices went down quite a bit post GST reduction, right? There was a demand in the non-trade segment during that point in time. Also, the fact is, during this Diwali season and extended rains also during this time, laborers have not come back to their respective sites.
I'll just take you back a little bit because there was also elections in Bihar during that time. So laborers went back to their respective states and they came back to the site only after this election of Bihar. So scarcity of laborers and hence there was more demand in sites where onsite Ready Mix Concrete plants were there and hence more of a demand in non-trade segment. That is what the reason is.
Can we confirm that this situation was a temporary thing and in the current quarter our share of trade should be back to a fairly decent level?
Yes. I think in the month of December and January only, I think we have gone back even little better than what we have done before. Not an issue. That was a very temporary thing. Extremely temporary.
Got it, sir.
Mr. Srinivasan, you need to understand. We commissioned our plant in the month of September. We also had to really kind of test that capability of plant. We need to ramp up that plant. I think that was also one of our priorities during that time. Right?
No, sir. My concern is not about the non-trade volumes growing. My concern is about trade volumes, why it did not grow, but I have got the answer from you. Thank you so much.
We have come back. We have come back very strongly in December and even in January.
Got it, sir. Thank you very much.
Thank you.
Thank you. Ladies and gentlemen, if you wish to ask a question, please press Star and One. We take the next question from the line of Sanjeev Singh from Motilal Oswal Financial Services Limited. Please go ahead.
Yes. Thank you for the opportunity, sir. Can you throw some light on the pricing scenario in your respective markets, be it north, south, north Gujarat, as well as east region during 3Q because the realization seems to be down around 10% on a sequential basis. Also, what was the gap between trade and non-trade prices in the markets where you operate?
Typically, if you look at our footprint, which is there in part of western market, which is Gujarat, heavy on institutional sales. We go to Mumbai, which is also a little heavy on institutional sales. And part of north, I would say Rajasthan, Haryana, and west part of U.P. If you really look at distribution of our sales, then because I told the earlier questions I was replying to that, post GST reduction, there was some sluggishness in the market and hence effort was there to really at least sell some volume from newly installed capacity, which was Surat.
Also, in other market also, there was some sluggishness in demand in trade segment. That is kind of common with the industry. If you really look at, I think that cut across majority of the players who have reported their volume. Their volume has gone down percentage-wise in trade in majority of the cases, not all. Right. That has happened with us also. In our case, more predominant because our dependence on Gujarat is much higher than other players. That is what has the case has been for us.
Secondly, sir, how is the pricing scenario as of now in the month of January? Plus, if we look at your employee expense, then sequentially that has gone down from INR 130 crore to around INR 160 crore. What has been the reason for that?
I'll ask second question first. As I said before also that we have been optimizing or improving productivity at our different locations. First phase we had done last year. Second phase we had started a couple of months back, three, four months back. In fact, going forward also, I think we do have plan to improve our productivity. One, of course, to improve the volume and second also, per person productivity in terms of cement revenue to per ton cement revenue you get. That effort even is still continuing. That has benefited us in terms of reduction in employee cost. So, one. Second, you asked about pricing scenario. Almost in all markets, post I would say December onward, maybe latter part of December, non-trade prices have gone up everywhere.
Trade prices have not gone up that much, but I see since demand has been very good in the month of December and that is still continuing in January and February also is a similar situation. I see that prices in trade also will go up from two counts. One, improved demand situation, and second also, fuel prices are going up. That also, I think will have to recover from the market. From these two counts, trade prices also we expect that will go up. Even non-trade also the gap which is still very high in different markets, that will also get shortened going forward. Price-wise, I see a good improvement in non-trade segment in the last one and a half months. Going forward, I see improvement happening in trade as well along with non-trade. Pricing-wise, I think I see things are improving. For sure.
Should we assume that employee cost will remain at INR 115 crore-INR 120 crore kind of a range going forward?
I think our endeavor is, I told you that-
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 reconnected. Sanjeev, if you could please repeat your question for the management. Thank you.
I was asking about the employee cost. I think he answered it.
You asked two questions, one on pricing, which I said non-trade has gone up. Even trade also is expected to go. Second, on employee cost, we had taken some previous projects. In fact, our endeavor is to further improve the productivity, which we are working on. Yeah. These are the two things we dealt.
Yeah. Thank you, sir.
Yeah.
Thank you. Please press Star and One to ask a question. We take the next question from the line of Harsh Mittal from Emkay Global Financial Services. Please go ahead.
Good evening, sir. Thank you for the opportunity. Sir, I have few questions. First one being, continuing with the previous participant's question, do you feel that the realization could improve in the similar quantum, what we lost in Q3?
Yeah.
In the coming quarter four.
Yes. As I said, prices are improving and volume also is improving, so we will get some leverage as well. So yes, I definitely see that.
And sir, what was the clinker sales for this quarter? If you can just break it between cement and clinker sales in quarter three.
1.51 lakh tons.
And the clinker utilization levels?
We had 90%.
Sir, last question. What is the CapEx that you have already incurred for the Durg Line -2, and have we ordered clinker units for Durg Line -2?
Basically, in Durg Line -2, we have not incurred much of the CapEx other than what we had mentioned in the last call. In the first nine months of the current financial year, we have incurred about INR 250 - INR 260 crore. We have incurred. We have talked about a figure of about close to INR 400 crore in the current financial year of the Durg project. The balance will happen in the current quarter.
We will be spending INR 400 crore out of the INR 3,000 crore planned in this year?
Yeah. Only INR 400 crore current financial year. You are right.
Right. We are aiming for everything commissioned, including the clinker and grinding unit by March 2027. Am I right?
Yeah. The entire project will get completed by March 2028, including all the spread location.
March 2028. Okay. Sir, these were the questions. I will join that call. Thank you.
Yeah, thank you.
Thank you. Press Star and One to ask a question. We take the next question from the line of Harshal Mehta from AMSEC. Please go ahead.
Hi, sir. Thank you for the opportunity. Three questions from my end. Firstly, in terms of realizing the starting and ending that. This quarter, we have seen a very sharp decline of 9% on quarter-over-quarter basis. Could you please help understand the drivers behind the same? Additionally, if we see over the last few quarters, volatility in terms of realizations and EBITDA pattern continues to remain much higher versus peers. Any color on the structural or operational factors behind this volatility will be helpful. Also, in terms of price, if you can just throw some number on how our spot prices versus Q3 average for the trade and non-trade segment in our core operating markets. That was one. Secondly, on the project updates. Two clarification.
Firstly, we already understood that it was planned to be commissioned in two phases, 2.2 million tons by March 2027 and 2.4 million tons by March 2028. Does this phasing remain intact? Secondly, on the overall Durg CapEx, INR 3,000 crore is a number what we calculated that still remains. That was the first question. Lastly, in terms of, if you can just share some data on regional mix for this quarter, clinker-to-cement ratio, and the clinker using 2Q and 3Q of FY 2025. That would be helpful.
Got it. I'll answer first part of it on the realization part of it. I explained that. Drivers were, one, non-trade prices went down drastically post GST reduction. One. Second, in our case, because you also mentioned about peers, our dependence on Gujarat is a little higher. Since non-trade prices went down everywhere, including Gujarat, and our trade sales was also not that great. I think 49%, that is what our trade is, right? These are the drivers why realization has gone down. This is one. Second, I think you also mentioned about on this realization quarter-on-quarter basis. I think one thing we need to understand is our footprint. Our footprint, and since I think we are limited to some geographies like in north, we are only in part in north. North limited to only Rajasthan, Haryana, and West U.P.
We don't go anywhere. In west, we are only limited to Gujarat and part of Mumbai. We don't go anywhere else. In east, we are only limited to Chhattisgarh and maybe a little bit of neighboring states, right? Anything kind of happens in this market, either upward or downward, that impacts us, right? This is little different than other players because they have little spread footprint in different markets. That gets kind of assimilated, and that gets averaged out. But in our case, as I mentioned that, let's say you take last quarter. Last quarter, our sales in the west part of India, which is predominantly Gujarat for us, was higher than previous quarter one. Second, non-trade prices went down. So we were impacted much more than what others would have been, right?
And if you see the last quarter, if you refer, go back to July to September, right? During that period, Gujarat did better, and in fact, all markets were better wherever we were present. In our case, I think Chhattisgarh did very well. Rajasthan, Haryana was very good, and Gujarat also kind of performed very well. So I think everything ticked together, and that is why you see a good performance in quarter two and not so great in terms of realization, though if you really look at the bottom line, whatever the estimation was, I think we are close to that. I think there is no miss on that count, right? But yes, because of the footprint which we have in our case, I think that definitely has a bearing on us. So this is what on realization.
Second, I think pricing, I told you, I see prices are going to do better. One, because of improved demand. Second, also, I think cost is going up. So prices definitely will go up going forward. Non-trade prices have gone up in majority of the market. Even trade also is likely to follow. That is what my estimation is. So this is what you asked. I think your question was quite overloaded. You asked about clinker factor, which I think I will give you, that is 1.49.
1.44.
1.44. You asked about CapEx of INR 3,000 crore, so that remains. This is what I remember. If anything is missing from my end, just let me know.
Yes, so multiple things. First, on pricing, if you can just tell me a particular number in terms of trade and non-trade, how we are at spot versus Q3 average. That was one thing. Secondly, on project updates, I was just asking 2.2 million by March 2027 and 2.4 million by March 2028. That still remains intact. That was just a clarification. Lastly, I was asking on the regional mix, if you can share for this quarter. And clinker sales for the last year, like Q3 FY 2025 and Q3 FY 2026.
Yeah. So last year it was 7.23 lakh tons. This year we have already told you, last quarter it was 1.51 lakh tons and for the whole nine months it is 5.34 lakh tons. On this pricing and this thing, all these things, this is not handy with us. We can give it later.
Sure. Thank you, and all the best.
Thank you.
Thank you so much.
Thank you. Please press Star and One to ask a question. We take the next question from the line of Amit Murarka from Axis Capital. Please go ahead.
Thanks for the opportunity. I think a lot of questions have already been asked about your pricing decline. But honestly, it is still a little confusing because while I see that your share of non-trade has dropped by 4 percentage points from 53% to 49%, it looks like even the overall portfolio seems to have deteriorated in pricing including trade. But generally north, I think the trade pricing was pretty steady. Is it like your non-trade price decline kind of influences even your trade pricing in the market, even, let us say if the other category players, let us say the likes of UltraTech and all.
Essentially does your gap increase between trade also versus the higher price players in the market when non-trade goes down? Because essentially such a sharp decline, I think was not there in the market essentially in any of the markets. It is still a bit confusing over there why it has gone down so much.
Mr. Murarka, I just repeat once again. Trade prices almost were intact. The gap which we were having with the leading players, that remains. That has not widened. I told you two reasons, precisely two reasons, and we do have that detailed reconciliation also with us. One is, of course, I think Surat we started on 22nd September, and we had to really ramp it up. Surat expansion, typically this caters to market of Gujarat and Mumbai, which is heavy on non-trade. This is one. So increased volume in non-trade and decreased price in non-trade. I think that has impacted the most. That non-trade reduction is not limited to this market. Non-trade prices went down in other markets as well. But the most impact on us was from Gujarat State. This is why this has gone down. One. This is what I think you asked, right? Anything else?
Yeah, no. If I simply put, if I think of it that trade was steady, which is, let's say 50% of your volume, 9% overall realization decline would imply about 18% fall in non-trade pricing, honestly. Which I don't think was the case in the market of-
If I give you still the kind of price drop. In fact, when I was doing this road show in Mumbai during that quarter, I did mention to some of you, I think I don't know who all are there on the call, that what kind of price drop we see in non-trade. So non-trade, particularly in western market, non-trade prices were not that great. In fact, whole GST reduction since demand was sluggish, non-trade prices went down in other markets also. For instance, let's say, we have a grinding station in Cuttack, Odisha.
Odisha was not that great non-trade price-wise. Even Chhattisgarh, though I think our non-trade presence is not that much, there also prices went down drastically, gap increased. So if you put things together, I'm just giving you the major impact which it is having on us. So I think that has impacted us. That is what I am trying to explain to you.
Okay. Sure. Could you also share the non-cement revenue in the quarter?
Sorry?
The non-cement business revenue in the quarter.
Yeah. I will tell you. INR 147 crore.
How much was RMC in that?
RMC was INR 67 crore.
Okay. Also AAC blocks?
AAC INR 56 crore.
Got it. The EBITDA margin would be roughly how much in this?
4%.
Sure. Lastly, the CapEx number for this year, if I understood right, you said INR 260 crore has been spent and another INR 400 crore will happen, so it is what, INR 650 odd crore CapEx for FY 2026 then?
No, it is about around that. You are right. Total CapEx.
INR 650 odd crore.
Yes.
The next year would be how much?
The next year we are targeting anywhere between INR 1,600 crore-INR 1,700 crore.
Sure. Okay. The balance will be in 2028 then.
You are right.
Okay. Thank you. That's all from my side.
Thanks.
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, sir. Good evening. Am I audible?
Yeah, very much. Good evening, Ravi.
Yeah, good evening. Hi, sir. You shared the operating numbers and just wanted to understand, your non-trade mix did increase quarter-on-quarter, and you also mentioned that there was a sharper drop in non-trade. Broadly, could you suggest what would be the fall if trade prices would have declined on a like-to-like basis by 2%? How much would have been the drop in your non-trade realizations broadly?
I think that varies. The sharper drop-
Broadly on an average, 5%, 10%, just wanted to understand. Because trade we understand it would have been dropped by 2%-3% at max, seeing results of various peers. Just wanted to understand non-trade, markets where you operate, what could have been the quantum of correction?
Correction would be about no more than 10%. Exactly, I'll tell you maybe straightaway.
Okay.
Yeah.
Mm-hmm. Could you also share what was the clinker volumes in Q2? You mentioned 1.51 lakh tons for Q3. For Q2, what was the number?
I'll just tell you, Ravi.
1.71 lakh tons.
1.71 lakh tons.
Okay. It dropped quarter-on-quarter.
Yeah.
Okay. What explains the sharp decline in your input costs on a Q-on-Q basis by almost INR 150, given that your fuel cost remains steady at around 1.4, 1.6, and green power mix has also been stable. There would not be any, given that clinker production was lower, so there would be more power consumption and whatsoever. If I look at the total input cost, raw material, power and fuel, and change in stocks, that number has come down by INR 150. Secondly, the fall in the freight cost, sharp fall by more than INR 100 per ton. Is it on account of higher non-trade sales, which is mostly ex-factory?
You are right on point, Ravi. Yeah. This happens only for plant, and if you look at our lead has also gone down. That has, yeah, you are right.
For the input cost reduction, sir?
Input cost has given me, yeah.
Yeah.
Power cost has, Ravi, gone down from
INR 5.52 -INR 5.37.
INR 5.52 -INR 5.37, right? Per unit.
Okay. INR 5.52, INR 5.37. And year-on-year, how was the number, sir?
Year -on -year. Just give a sec.
Sure.
Yeah.
Ladies and gentlemen, we have lost the line to management. Please stay connected while I reconnect the management. Thank you.
Hello.
Ladies and gentlemen, we have the management line reconnected. Sir, please proceed.
Yeah. Hi, sir. You were answering the input cost reduction.
Hello. Yeah. Sorry, I think we are struggling with issues in our office today, unfortunately. Extremely sorry for that. We are back now.
Yeah. So you were explaining the input cost reduction on a sequential basis.
Yeah. So INR 5.52 -INR 5.37, that is what I told you, right?
Right, sir.
Yeah.
Hello.
Yeah. Go ahead, please.
Yeah. This is the nominal change, right? The power cost.
If you want, we can give you the details also. We are not handy with that.
No, that's all right. Second, sir, on the CapEx project, you mentioned that you have spent INR 260 crore and another INR 400 crore is targeted for Q4. Given that January is already out, can we assume this INR 400 crore is on track or are there chances of any major slippages? Second, given that you're targeting the Durg expansion raw material over the next 12 - 13 months, what is the status of the execution on that? Has the civil work already started? What is the status on the equipment ordering, and when would the equipment installation would start? Because that would require some time for them to get executed.
Yeah. We are broadly on track for the CapEx, which we have talked of in this , We spend about INR 400 crore in the current quarter. Most of the equipment have all been ordered, and construction should start as soon as excavation has started. Once the equipment land there, we will start the installation there.
This 12-month target for the clinker is good enough for getting the plant operational by March next year?
Yeah. As of now, it is okay. We are monitoring it regularly, and we will keep you updated on that.
Great. Just two last more questions. One on the railway siding Phase two, what is the status? Second, how is the demand traction so far you are witnessing in the Q4? January has passed on, and we are hearing non-trade prices across India have improved. What is the status on trade price improvement, and why is that not picking up? Usually non-trade price firming up leads to a better trade price.
Oh, yeah. As far as the railway siding is concerned, the second phase, that is expected to be completed by March 28, and then the other part which-
Demand and pricing. Yeah. How is the demand shaping up in Q3? Are we expecting a similar type of growth in Q4 for the company as well as for the industry? Industry also would have grown 7%-8% in this Q3.
Yeah. Q4 being the base a little higher, so yeah, I think demand momentum is good. What we see, definitely, I think, a double-digit growth in Q4 as well. Right. Industry, and of course, I think we'll also grow in line with the industry volume-wise. On the price. On pricing, yearly, basically, if you look at, I think our estimation is industry would grow by about 7% or so. Q4 is going to be double digit. This is what we see as of today. Pricing-wise, non-trade prices have gone up in almost all markets.
Maybe, I think some of the market like Odisha and all, still prices have not gone up that much. In the trade, since demand is good and cost also is going up, prices are likely to go up in trade as well. Now, you asked why trade prices did not go up. Precisely, I think trade prices were almost intact. That did not go down maybe that much. Non-trade prices, which went down drastically in almost all markets, that is resurrecting. Since demand and cost also is now pushing, so the trade prices also will go up.
Great. Just last question, if I squeeze in. How is the fuel price outlook for Q4, sir, given the surge in pet coke prices? Also for Q1, is there some indicative number you are looking at?
Yeah. Coal prices, yeah, it is going up. I think definitely it will go up because whatever we have in stock, that we have almost exhausted. Now the new buying is also happening. It will go up by at least-
What it is about to be.
Yeah. So INR 1.56 to about INR 1.60.
INR 1.58.
INR 1.58 -INR 1.60. That is what we see in our case.
Okay. Great. That's all from my end. Thank you, and all the best.
Thank you. Thank you so much, Ravi.
Thank you. Please press Star and One to ask a question. We take the next question from the line of Pushkar Jain from Mili Capital. Please go ahead.
Yeah. Hi, sir. I just wanted to ask that our non-cement revenue currently operates at like 4% EBITDA margin, which is significantly lower than the core business. What is the tipping point volume where operating leverage kicks in for AAC blocks to match the double-digit margins of gray cement business or something to that effect?
All these businesses, you have a very good ROC. EBITDA margin, I think we are in almost alignment with the industry. Right. That varies. Ready Mix Concrete operates at about 3%-5% kind of thing. Plaster of Paris business, that is little on higher side, and AAC block is somewhere in between. Though we are working on improving productivity all across and our effort is to really focus much more in case of Ready Mix Concrete on value-added concrete, in case of AAC block, improving AAC footprint.
We are working on that as well. Now we are also in the process of ramping up our Alwar plant, which produces a putty and little bit of white cement. Perhaps that will take our margin little better than what we have today. Right now, I think since all these product lines and installations are in the ramping up phase, we see that improved margin going forward. Not closer to the cement. I would not say that we will reach to the cement level, but definitely a higher single digit. That is what our effort is.
When to reach there by?
It will take at least two years' time. At least two years. Yeah.
That's right. Thanks a lot, sir.
Thank you.
Thank you. A final reminder and no further reminders will be placed to ask questions. Please press Star and One to ask a question. We take the next question from the line of Tushar Chaudhari from Prabhudas Lilladher Private Limited . Please go ahead.
Yeah. Thanks a lot for the chance. Sir, most of my questions have been answered. Just I had one doubt. We have seen 4 percentage point decline in trade share in this quarter. But our blended share is flat-ish or constant. What could be the reason for this?
Blended is 62% I suppose last quarter.
Yes.
Right.
Yeah, it has not fallen at all.
Yes, sir. Institutional sales is not only about OPC.
Right.
Institutional sales is also about blended cement. For instance, we have started pushing. Again, I think it has gone up. Are you there? Hello.
Yeah, I'm there, sir.
Yeah. Institutional sales, we are trying to push blended cement that is PPC. In lot of Ready Mix Concrete plants, we have supplied now PPC, which was not the case before, right.
Okay. Right.
Non-grade percentage increase necessarily doesn't mean that OPC goes up because our effort is also to work on the carbon footprint and the carbon net zero roadmaps, which we have defined for ourselves. We are working parallely on that. Effort is to really push blended cement in institutions.
Right. A few other things, I missed your employee cost. Did you say that employee cost will continue to go down further also next few quarters?
No, it will not go down. I think it will get stabilized.
Okay.
Or yeah. Or maybe, I think if you look at some of the sites we are adding, right? Surat we have now added, right? Surat, I think we need to reinforce the team. Then we have some increased footprint in Ready Mix Concrete business, right? I think our aim is to really improve productivity rather than employee cost, focusing only on employees.
Right. And lastly on CapEx, FY 2026, you said INR 650 crore, out of which INR 400 crore we have planned for INR 3,000 crore CapEx, which is ongoing. Am I right?
Yeah.
Okay. Thanks a lot, sir.
Thank you. We take the next question from the line of Kamlesh Bagmar from Lotus Asset Managers. Please go ahead.
Yeah, sir. Just one question. So far, whatever results have come from the sector, we haven't seen this sharp fall in realizations. The 10% quarter-on-quarter fall in realization, ex of non-cement other news. How we define that, sir? There is a significant fall, INR 456 quarter-on-quarter, and I would say same market is there for all other peers as well. Why we are seeing such a sharp fall? Over the quarters they are earning, ideally, they do not understand how the communication has been. So far in the last compound, we were saying that relations are not going to fall that much. What we are seeing is a massive fall of INR 450 quarter-on-quarter realization.
I think I explained to you, Mr. Kamlesh. Whatever I had to say and whatever, something exceptional happens. I told you our footprint and wherever we are. I do not know which peer group you are comparing with. I am not too sure. Maybe I think you have something in your mind. I told you that our presence in some of the market, which is heavy on non-trade, is high, and that increased in last quarter. There were reasons also for that. I explained to you that. That is what I think I have to say. Nothing more.
No, but now going forward, have we been able to recoup all the fall in the realizations in this quarter? Where do we see our realizations in the current quarter?
Yeah. As I said, in all these markets, we are in the competitive scenario. We are competing with other players. The way that market moves will move in that alignment only. Right? I told you the pricing scenario also, right? For us, I think priority in quarter three was to really ramp up the additional capacity which we had. I think that was the right decision, right call. Right? That is now getting stabilized, and things will come to semblance for sure. That is what. See, and we have seen that in the last few months as well. This is what-
But if you can quantify how much, what our current realizations are compared to Q3 average or whatever we have reported in this quarter.
Right now, we cannot quantify because still two months are left in this quarter. So let's wait for some time because there are volatilities in the market. So if I tell you something, and tomorrow again you will ask me a question, then you had mentioned that. So I think that is not fair on my part. So I will keep you updated. Since only one month is over in this quarter, things are moving in a positive direction, and hopefully, I think that direction will not change. This is what my conviction is today. But quantifying things as of today is perhaps I may not be able to.
Okay, great. Thanks a lot.
Thank you.
Thank you. We take the next question from the line of Parth Bhavsar from Investec. Please go ahead.
Yeah. Hi, sir. Thank you for the opportunity. Sir, I have two questions. One is, sir, what was was you fuel cost consumption basis in Q3 ?
It was 720.
Sir, how much was it? I didn't get it.
720.
Sir, on kcal basis?
Yeah, kcal basis.
Okay, got it.
I think the first one, INR 1.56. Yeah.
INR 1.56. Okay, got it. Sir, one more thing. Would it be possible for you to quantify the Gujarat sales maybe for the Q3 quarter as well as base year and previous quarter? Is that possible?
I think this is not handy with me. We can talk on this later.
Thank you, sir. Those are my questions. Thank you.
Thank you. We take the next question from the line of Shravan Shah from Dolat Capital. Please go ahead.
Yeah. Thanks finally for the opportunity. Sir, most of the question answers are again coming on the realization part. Sir, just to get a quantitatively better understanding, since 1 January till now, non-trade prices for us has gone up by how much, INR 15-INR 20 odd ? Is that the fair understanding?
So Shravan, this varies in different markets, and the range I would put is INR 10 to INR 15.
Okay. And in terms of trade, you said it remain at the same level.
Yeah. Trade, I think we have been around 54%, 55% level.
Yeah. But now we are seeing that the trade prices to also go up.
Shravan, likely to go up.
Yeah. Likely to go up. Yeah. But given that, sir, some of more capacity is still to come up and everybody will try to push the volumes for the March. Even we are considering that there will be some rollback in the month of March.
That is what I was trying to make understand earlier, the gentleman, Mr. Kamlesh. Whatever we say based on what we see today. I think there is lot of volatility and dynamism in the market, and based on that, we will have to take our business calls, which we keep on taking. Definitely, forecasting sitting today, I think it becomes very difficult. I agree with you.
Yeah. Understood. Because the issue for us, why everybody is trying to hop on the same thing is because to make the number or the estimates as an analyst, this kind of a deviation at a INR 200, INR 300, INR 400 makes our entire estimates goes on for a toss. So will be difficult to also, it become from buy to it can become a sell, from sell to it can become a buy. So that's why everybody is trying to understand why such a significant volatility in the price is for us. So that's the only thing. Sir, just more clarification in terms of total CapEx in nine months at console level is how much, sir? Is it INR 260 crore? Because INR 250 crore was there in 1H.
Yeah. Just hold on, Shravan.
Yeah.
On a console basis, including the various projects which we are doing, in nine months is about INR 350 crore. INR 260 crore we are talking of only for the Durg expansion.
Okay, INR 350 crore. We will be doing a kind of INR 400 crore on Durg. Maybe if you can specify in terms of on a yearly basis, the maintenance CapEx would be how much? INR 200 odd crore for us?
No, maintenance of us is not INR 200. It is totally INR 50 crore in a year.
Okay. So for FY 2026 would be then INR 350+ crore so INR 750 crore-INR 800 crore would be the total CapEx at console level for a quarter.
That is why initially, it could be ending up maybe anywhere between six. It will not touch INR 800 crore. It is INR 650 crore-INR 700 crore at best.
Okay. Understood. On the conveyor belt, is there any update or it's the same what we said last quarter?
Yes, same status. Still is in the final stages. Same status.
In terms of the further expansion beyond this, the Nagaur, Kutch, and Assam, whatever we say to reach 30 million tons, that stands remains same. In terms of the Net Debt/EBITDA, that 3x, 3.5 x that we will try to maintain.
Yeah. We like to not cross that limit.
Okay. And, sir, in terms of the cost reductions from here on, from Q2 would be a difficult even for on the cost basis because when you say the staff cost, that also I want to understand more. From Q2 to Q3, the number of employees, has there a decent decline or was there a salary cut?
So no salary cut, productivity improvement, and that is what we will keep doing even going forward. We do not do salary cut.
Thank you. We take the next question from the line of Harsh Mittal from Emkay Global Financial Services. Please go ahead.
Yes, sir. Thank you for the follow-up question. Just one question. We are already working at more than 90% clinker utilization, and our Durg Line -2, as mentioned earlier in the call, will not be coming before March of 2027. So what can be a safe assumption for the volume growth for FY 2027, sir?
FY 2027, we have some headroom in Surat, one. We have some headroom in Udaipur, second. We do have some headroom in even Jhajjar, Jharli. And fourth, we have some headroom in Cuttack. I think this is what we see that this will keep us on the growth path. Right? Even next year also, I think we see a similar kind of growth, of course, contingent to the industry growth, right? But a similar kind of growth even next year.
Sir, are we sourcing clinker from outside or something like that? Because we are already working-
No.
Okay. Thank you.
No, we are calling it.
Thank you. Ladies and gentlemen, due to time constraint, we take the last two questioners in the queue. We take the next question from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Yeah. Hi, sir. Just wanted to confirm the depreciation impact in this quarter increase. Is it totally on account of Surat? Is there any mixed answer?
Yeah, basically, you are right. Surat got commissioned in the last week of September, so interest and depreciation increase is the capital related cost increase on account of Surat.
This is totally for one quarter impact in depreciation, because from INR 78 crore it has gone to INR 85 crore. There is a sizable INR 7 crore-INR 8 crore, which we analyze it, then it becomes INR 36 crore. While the project cost for this expansion was, if I recollect, it was less than INR 300 crore. It is one quarter impact in December quarter?
I was told that about INR 6 crore is on account of the Surat and some normal CapEx has happened, and third is on account of the leasehold land depreciation also being charged.
Understood, sir. Could you give what was the clinker production for FY 2025 consolidated basis? Clinker sales, sorry, not production. My bad. Clinker sales, total full year.
7.23 lakh tons.
Okay. 7.23 lakh tons. This was for the full year? Okay.
Yes.
Because if I see, you told your clinker-to-cement ratio is at 1.44. Are you looking to increase the clinker-to-cement ratio in FY 2027?
Yes.
Because earlier in FY 2021, 2022, 2023, you operated at 1.54 and more than that. Now it has come down to 1.44. What is the safe assumption for next year?
I think our effort is to take this blended cement from 62% to about 67%. To that extent, our clinker-to-cement ratio will improve.
Understood.
Right.
Understood. That's all from my end, sir. Thank you.
Thank you. Thank you so much.
Thank you. We take the next question from the line of Amit Murarka from Axis Capital. Please go ahead.
Yeah. Hi. Thanks for the follow-up opportunity. Just wanted to clarify on Durg CapEx. I see that your November corporate presentation mentions the CapEx number as INR 3,300 crore. Can you just clarify, is it INR 3,000 crore or INR 3,300 crore?
Yeah, we had included some expenditure on the conveyor belt also therein. Otherwise, it is INR 3,000 crore only.
The conveyor belt is added to that, but that's already going on, right? I mean, what you mentioned.
No, that is not going on. That is stalled because of this issue of the land, as we've been talking about. That includes the expenditure already incurred plus the balance to be incurred, which is about INR 170 odd crore.
Okay. If there's no progress on the conveyor belt, then it is INR 3,000 crore then?
Yeah.
Okay. Sure. Thank you. That's all I wanted clarified.
Thank you.
Thank you. Ladies and gentlemen, with that, we conclude the question -and -answer session. I now hand the conference over to Mr. Vaibhav Agarwal for his closing comments.
Yeah. Thank you, Ryan. On behalf of PhillipCapital (India) Private Limited , we would like to thank the management of JK Lakshmi Cement for the call, and also many thanks to our participants joining the call. Thank you very much, sir. Ryan, you may now conclude the call. Thank you.
Thank you.
Thank you so much.
Thank you.
Thank you. On behalf of PhillipCapital (India) Private Limited, that concludes this conference call. Thank you for joining us, and you may now disconnect your line.