Q2 25/26

Oct 24, 2025

Good morning, ladies and gentlemen. Welcome you all to the 2QFY26 Result Conference Call of Sagar Cements Ltd. We have with us today Mr. S. Sreekanth Reddy, Joint Managing Director; Mr. K. Prasad, Chief Financial Officer; Mr. Rajesh Singh, Chief Marketing Officer; and Mr. J. Raja Reddy, the Company Secretary. I would now like to hand over the call to Gavin Desa for his opening comments, and then over to management. Over to you, Gavin. Thank you, Viva. Thank you for introducing the management. I would just like to add that some statements made in today's discussions may be forward-looking in nature, and a note to this effect was stated in the call invite sent to you earlier. We trust you have had a chance to go through the result communications that were shared with you yesterday. I would now like to hand over to Mr. Reddy for his opening remarks. Over to you, Sreekanth Reddy. Thank you, Gavin. Good morning, everyone, and welcome to Sagar Cements' earnings call for the quarter half year ending 30th September 2025. Now, let me begin the discussion with a brief overview of the market, post which I will move on to other specific developments. As anticipated, overall demand during the quarter was relatively subdued, reflecting the typical seasonality of the monsoon period. Despite this, we recorded positive volume growth on the back of a softer base from last year. The pricing environment remains broadly stable, with the margins softening in line with seasonal trends. On the cost front, input prices, particularly for power and fuel, remain steady through the quarter. Looking ahead, we expect demand conditions to strengthen in the second half of FY25, supported by defensive consumption and higher government spend. Moving on to Sagar's specific performance, Q2 registered a volume growth of almost 70% year-on-year, while our revenue for the quarter today reached INR 602 crore compared to INR 475 crore for FY25, an increase of almost 27%. EBITDA for the quarter today reached INR 51 crore, as against INR 20 crore in the prior year period, with margins improving to 9% from 4% a year ago. EBITDA per ton today reached INR 377. For FY26, we expect the overall sales volume to be around 6 million tons. Our profitability outlook remains positive, supported by ongoing cost optimization initiatives such as freight efficiency through shorter lead distances, lowering the clinker factor, upgrading the Andhra Cements Ltd plants, and increasing the share of renewable energy in our power mix. As capacity utilization across our plants continues to rise, we also expect to gain from operating leverage in the coming quarter. The net loss after tax during the quarter today reached INR 44 crore. Power and fuel costs today reached INR 1,428 per ton, as against INR 1,446 per ton during Q2 FY25. Sales cost for the quarter today reached INR 855 per ton, as against INR 830 per ton during Q2 FY25. From an operational point of view, Mattapalli plant operated at 48% utilization, while Gudipadu, Bayyavaram, Geerabad, Rajpuri, and Rajpur plants operated at 52%, 63%, 94%, 34%, and 32% respectively during the quarter. As far as the key balance sheet items are concerned, gross debt as on 30th September 2025 today reached INR 1,610 crore, out of which INR 1,216 crore is long-term debt, the remaining constitutes the working capital. The net worth of the company on a consolidated basis as on 30th September 2025 today reached INR 1,758 crores. Debt-to-equity ratio stands at 0.69:1. Cash and bank balances were at INR 175 crores as on 30th September 2025. Our capacity expansion projects at Andhra Cements Ltd and Geerabad are progressing as per the plan. The construction of a new six-stage preheater was successfully completed at Rajpuri plant, and after trial runs, it got commissioned on 23rd October 2025. Further, we expect to commission the cement capacity by the end of Q1 FY27. The 4.35 MW waste heat recovery system at Gudipadu units and the expansion of Geerabad capacity from 1 million to 1.5 million is expected to be commissioned by the end of FY26. In summary, our expanding capacity has successfully positioned the company, capitalizing on the projected growth in infrastructure and real estate development in the coming years. Furthermore, our ongoing initiatives to diversify revenue streams enforce our regional presence as anticipated to further enhance our overall profitability. To conclude my opening remarks, I would now be glad to take any questions that you may have. Thank you. We will now begin the question and answer session. Anyone who wants to ask a question can indicate through raise of hand. First question we will take from Mr. Shravan Shah. Shravan, you can unmute your line and go ahead with the question. Hi, sir. Thank you. Sir, a couple of things to understand. Particularly volume, you already said that you are maintaining a 6 million ton kind of guidance for this year. Next year, also last time we have said around 7 odd million ton for FY 2027, that also remains the same. Next question, we are not sure what we are looking for. We probably may want to revise our quote, just to see if you want to comment on that. As I said, we currently are planning 30, and it would be 7 minimum, 7. Sorry, sir, I didn't get it. Yeah, the next year guidance probably we would like to revise our quote, but at this point of time, we would like to minimum 7. As we come closer, probably it might be some revision in code revision for the next year. Okay, okay, got it. Second, sir, coming to on the costing front particularly, just wanted to understand each line item better. First, let's say starting with RM cost and then the employee cost. Employee cost, this time we have seen a INR 5 crore quarter-on-quarter increase. How one can look at, any specific reason for that, and will this INR 39 crore kind of a quarterly run rate continue in the third and fourth quarter? With the overall appraisal that has taken place, annual increment of close to around 10% has been implemented this one. The run rate more or less for the quarter is what we should look for going forward. The raw material cost and everything more or less is in our belief should remain flat. Though we are seeing slightly an uptick in terms of the PECO pricing, fortunately, the domestic coal as well as the imported coal more or less with the increase that we have seen in PECO, we are not seeing a significant change in the overall power and fuel mix cost. We are probably moving from PECO to the imported coal more because there has been a price drop in terms of the imported coal and matching price increases we have seen in the PECO pricing. Okay, this quarter, what particularly the change in inventory that we have seen, the significant kind of a consumption in whatever the inventory we were having in Q1, that has actually kind of impacted the profitability. In Q3 itself, can we see the kind of whatever we have seen, the increase INR 80 crore change in inventory, will the entire be getting kind of a reverse? As you indicate, Mr. Shravan, we closed down the entire rack. Probably in this current quarter might be a chance, but I think by the middle of next quarter, we should have actually bought and made up. Our outlook towards when we should be the indicator, what we have monitored close to around INR 600 EBITDA per ton, should be very close to that. Okay, for the full year, kind of a 600 kind of EBITDA per ton that we are kind of maintaining. We have taken, but if you were to remove the inventory adjustment and the leverage that we have got, we did INR 530 crore this quarter. What we indicated in INR 376 crore would be a kind of a number. Though the relationship. Sir, audio is not very clear. Sir, sorry, Sreekanth, the audio is not clear. You want to reconnect? I think let me switch off the video. I think it is more to do with the internet connection. I hope you are able to hear now well. Yeah, sir, it is better now. It is better. Yeah, yeah, Sreekanth, keep the video off, please. Yeah. The EBITDA per ton for the current quarter, except for the inventory adjustment, should have been close to INR 530. For the overall year, we don't see a chance to be very close to. Yeah, the audio is still not very clear, Mr. Reddy. I'm sorry, yeah. Sir, you can maybe speak one line. Let's see whether it is better now or not. I'm sorry for that. For all yearly numbers, we are keeping the same outlook. Yeah, sir, now if somebody has to look at, let's say, next year or going forward, in terms of increasing the profitability from 600, do we think we are one of the lowest cost producers. Unless we can see the kind of confidence or we have the confidence that now the prices can structurally go up, do we think that even for next year or even for FY 2028, what's the possibility to, or the percentage or whatever way, how much one can look at in terms of increasing the profitability? Let us take one step at a time, Shravan. The advantage that we see from Sagar's perspective is that there are some green energy initiatives which are work in progress. The solar just got commissioned in the current quarter. We could not capitalize fully. At the same time, waste heat recovery projects, and at the same time, expansion of half a million ton at Geerabad significantly contributes to the profitability. I think it's something which I cannot comment. From an internal efficiency perspective, these works we believe that should help quite significantly to us. By how much is a function of time? For the current year, we believe it is INR 600 EBITDA per ton. Going forward, closer to the date, I think we can start discussing one. As far as Sagar's profitability is concerned, with the expansion and at the same time waste heat recovery at Gudipadu, both these two projects should significantly contribute from energy. Now quantifying them and all, I think we would do that once we come closer because in Geerabad as such, we are fully sold. Can I just get to one sec and reconnect? Just give me a minute. Yeah, yeah. Viva, you are able to hear me well now? Hello? Yeah, Viva, are you able to hear me well? Yes. Your voice is still breaking, but it's clear from earlier. It's a little better than earlier. Yeah. Sir, last two things. One is in terms of now post the GST cut, do we see that the prices structurally going up at least in the near term, or do we see at least next two, three months it will be very difficult and maybe whatever is likely to happen maybe post January one can see and there also given the kind of the supply that the industry will be witnessing, do we think that the cement prices can structurally go up? Let me address the system. It's not clear to you, sir? No, Sreekanth, it's not low. It's very low. Yeah, let me fix the system. You are able to hear me well now? Yes, sir. Yeah, okay. Yes. Yeah. From a pricing perspective, if you look from a quarter before the start of Q1 to what it is right now, and what is right now from exit of Q1, there is not a significant difference, except for the adjustments that have happened in terms of the seasonal, price did not drop significantly. What we have seen in our own case is a 3 to 4% drop in terms of the realization, which is primarily on account of seasonality. This is in spite of, you know, midway through GST correction. Now, can we take the prices up from here? How it is going to shape up? Only time would tell. Our internal understanding is that as the demand picks up, which is likely to happen because demand, in spite of having extensive monsoon, I'm sure you all agree that across India, the monsoon has got extended quite a bit. Even now, it is raining. In spite of this, the volume pickup has shown a significant kind of an upturn. This should help us have better pricing. By how much and all, time would tell. I would always assume that Q4, we should be in a much better situation. Q4 should lay the foundation for a better pricing regime going into the next year. If pricing was weak, we would have seen an extremely weak pricing by now. We should have gone back to pre-Q1 kind of a scenario like how it was last year. Okay, got it. Lastly, sir, in terms of the land sale, last time we were looking at this FY2026 around INR 100 crore, INR 150 crore odd. Then the. Yeah, let me give you an update. See, we almost got the clearance, but they then observed a few typographical errors in the collectorate and the paperwork that was done. It had to go back again to get some of the typos corrected, especially some of the survey numbers and all. We do expect the approval process and everything to be concluded in the current financial year. Probably there could be a shift of a quarter to six months in the overall sale process. The good news that we can always celebrate is that WISAC, with all the activities that are happening, likely that we might get a better realization than what we anticipated before. With the Google and Adani's data center, large data center getting opened up and a lot of land being given to Wipro and Infosys and HCL, all these things are auguring well for WISAC getting a huge lift in terms of potential growth, which was in the sideline. That should help us realize more. Probably there could be a three to six months delay in the overall process that we have indicated from before. Sir, how much extra we can think so far? I think let us hold. Yeah, as soon as we get the approval, that is when we would want to reach out to the potential kind of buyers. That is when we would exactly know. As indicated, the government rate has not been upgraded, but there is a discussion that the government revenue rate is likely to get upward revised. Okay, thank you, sir, and all the best. I will be in queue. Thank you. Thank you, Mr. Shravan. Thank you. We will take the next question from Mr. Gurudarshan. Gurudarshan, you can unmute your line and go ahead, please. Thank you. Am I audible? Yes. Yes, sir. Could you please elaborate more on MP plants' EBITDA per ton decline in Q2? There's a steep decline of around 30-35%. Just wanted to understand reasons for this. There are two parts to the EBITDA decline, sir. One is an incentive because there is a large incentive that was received during Q1. Obviously, that was once in a year. That got added up to Q1. That is missing. If we net off those incentives, the normalized EBITDA per ton was to the tune of around close to INR 600 EBITDA per ton for Q1. If I have to net off, from INR 600, we came down to INR 377 at this point of time. The biggest delta in this is a small drop in the realization. As I mentioned, it is a 3% to 4% drop in realization. Coupled with that, the inventory got adjusted because during the last quarter, we had to shut the Andhra Cements Ltd plant completely, the clinker. Though we were doing grinding, most of the time we were consuming the clinker, which was in the stock. The same was the case for most of the time in Mattapalli, which is another large capacity in our portfolio. That was also under upgrade. That was getting maintenance shutdown. That was to the tune of almost 40 days, sir. These two, but for the inventory adjustment, we should have actually gone to somewhere around INR 350 plus kind of a number EBITDA per ton. Except for that realization drop of 3% and inventory drop, there is not much of a change in the overall kind of profitability position. Sir, how much incentive did we receive this quarter? Around INR 110 million, sir. Okay, in total, we'll be receiving around INR 46 crore, right, for FY 2026? Yes, sir. What we have received in Q1 was around INR 30, 34. This is 11, almost INR 45 crore is what we have received. All right. From next year onwards, how much incentive are we expecting to receive? I think around INR 25 to 26 crore as a minimum is issued, sir. Over and above that is subject to the power incentive, sir. That is likely to be anywhere between INR 3 to 5 crore as indicated. Okay. I'm sorry if my question is repeating the same question. You said exit of September, you're not taking any, not taking any price hike yet, right? Only in Q4 you'll get to know what would be the situation, right, in terms of price hikes and demand situation. Yeah, your understanding is correct, but let me again clarify. The challenge for us was two counts. One, the GST changed. The big change. We could survive through that. There is a small drop, which is again a seasonal correction, but for that, we did not lose the price, sir. The potential price increase is likely to get aligned with the demand, which is likely to come up. As you know, in some portion of South, monsoon is due in November and December. Sorry to interrupt, Mr. Guru. Can you please unmute your line? Thank you. Yeah. Post-monsoon, that is post-end of this Q3, that is where we believe that demand is likely to shoot up. That is when potentially industry could start trying to recover some amount of the price. Till such time, we believe the current pricing might continue. Understood. Thank you so much, sir. All the best. Thank you. Thank you. We have next question from Mr. Sukrit Patil. Sukrit, you can go ahead with your question. You are not audible, Sukrit. Okay, meanwhile, we will move to the next question. Mr. Pinnakin Parik, you can unmute your line and go ahead. Thank you. My first question is on demand. We have seen the announcements on the Google data centers, and obviously, the capital city has always been in the news. When do you see a big spurt in demand in Andhra Pradesh, which has on paper a lot of projects being lined up? Yeah, Mr. Pinnakin, good morning. Let me again not sound as cynical, but I think this time around the financial closure, he's actually seriously followed up with the paper announcement. Some of the key projects actually got the financial closure, be it from World Bank or ADB or the central government support. There are a lot of these projects which actually got the financial closure also done. Some of the contractors have already got the tenders. Fortunately, in our case, the people who aligned with us did bag a few large orders, sir. We do expect the pickup in terms of the full cement demand to start from end of Q3. For the next year, it might start picking up sometime middle of next year because these are in the initial phase. As you know, it'll be more to do with the documentation and the groundwork that may not significantly consume cement. We do expect from end of Q4 all the way up to middle of Q2, before the monsoon sets in, the volumes to start picking up significantly. I think the real demand surge is likely to happen in H2 of next year. Again, I'm only limiting myself to Andhra. The other good news is that what has happened is in Telangana, especially with the low-cost housing, the Indram Patkam, the government already has negotiated the prices with the industry players. The scheme is very straightforward, sir. The material, the beneficiaries' money would be transferred. They, in turn, have to buy from an indicated price from designated go downs they need to pick the material. That also is likely that post this season, post this off-season, the demand towards that for cement also is likely to pick up in a big way. We had multiple rounds of discussion discussing about the logistics and the issues that are hovering around that, especially to do with the payment terms and all. Though I would not say this is fully concluded, it has reached a good shape. That also is likely going to trigger a big demand from Telangana perspective, Mr. Pinnakin. Thank you, sir. Sir, going back to the Andhra demand, when you as a company and industry look at this data center demand, do you see this as an isolation related only to data centers, or you see a broader ecosystem of housing and everything? See, I think data center probably may not consume significant portions, sir. It could be a few million kind of square footage. The kind of cost to rub off each of these investments could lead. See, it's not just one data center that we are discussing, sir. We are talking of an amount of, you know, IT parks coming up, even IOCL coming up with a very large kind of refinery, and some amount of industry. There is a partnership summit which is due in the coming few months. Also, the COP that is happening in Davos. Usually, most of these investment commitments would come from the Davos Partnership Summit. Again, it is followed up with a large partnership summit that is being hosted in Andhra. These announcements probably should also start trickling in the peripheral investment which was in sidelines, waiting for good announcements to happen. All these things are likely to start getting fructified, probably end of this financial year to the early part of next year. These announcements should start triggering a huge demand, which is likely to be sustained over the next couple of years, sir, because these are just initial announcements, right? By the time they get grounded and start implementing, yeah, it should take at least a year, two years from now. We are very, very hopeful and very positive that the demand is likely to be sustained in a similar kind of double-digit growth over the next couple of years, especially in Andhra, sir. Got it, sir. Sir, my second question relates to pricing. Now, your Q1 Q decline of 3.5% just looks a bit high compared to what we thought was in the industry. Now, when you look at Q3, the December quarter versus the September quarter, given that there has been no price change on the ground, should prices be flat to higher? I think it should be flatter, sir. I would not expect it to be higher, but I would expect it to be flatter because, see, the monsoon in the South Peninsula of South would kick in now. With that, there are a couple of storms that are likely to happen. The monsoon has got extended in the northern parts, sir. Even now, as we speak, it's raining, which is very unusual. The number of wet days this time has been very, very high. Given this scenario, yeah, we do not expect a significant change in the overall kind of pricing. Though there could still be some positive changes in the non-trade, quantifying them would be a challenge as we speak, sir. I would keep my neck out to assume that prices may not drop. Prices may remain flat for the Q3 and start picking up at least from the early part of Q4. Might sustain till end of February to early part of March and probably a small correction for year-end kind of a push. That has been a historical scenario. That's what we expect even this time around. Got it, sir. My last question just relates to industry capacity addition. We saw one of the large players announce their next wave of capacity addition, but it had north and west in it. In your view, do you see south capacity addition being muted compared to other regions over the next three, four years, and that could potentially bode well for pricing? Yeah, Mr. Pinnakin, the capacity announcements in South, actually, I don't know whether it lagged or leads the industry. The reality is that some of the capacities just got added up, sir, and they are in a ramp-up phase now. Until this happens, we don't expect any new capacities that come up except for one large line that was announced by UltraTech, not in this quarter, a quarter before, which is at Petnikota. That is one which is likely to happen over the next 12 to 15 months' time. We do expect a ramp-up from Deccan. We also expect a ramp-up from all the capacities that came up. The one which is under construction, which is likely to happen over the next six to nine months, would be Ramco line two in Kolimkondla. Got it. Got it. Thank you very much, sir. Thank you. Thank you. We will take the next question from Mr. Vijay Pande. Vijay, you can go ahead with your question. Hi. Thank you, sir, for taking my question. I have two questions, sir. In terms of industry demand, how are you seeing in terms of the industry demand in the second half of this fiscal and FY 2027? Where do you see the biggest growth? I'm talking about the industry, so whether it will be north, west, south, or east. You can help guide us a little bit on the industry demand. That will be very helpful. Hello. Can you hear me? Yeah, we can hear you, but we can't hear management. Sorry. From a demand perspective, let me stick to the areas that we operate, sir, primarily the south. The south, as indicated in the past, we do expect a high single-digit for the current year, primarily on account of Andhra, to a certain extent, Telangana, more or less flat to slightly positive in Tamil Nadu, and 3% to 5% in Karnataka for the current year. We probably could be surprised positively. It could inch up to low single-digit, double-digit for the current year. Next year, we do expect around 15% plus kind of a year-on-year growth for Andhra and Telangana, sir. We expect 5% to 5% in Tamil Nadu and 3% to 5% in Karnataka, which has always remained very, very stable. Okay. Sir, I just wanted to understand the significant increase in Vayava in terms of operating expenses. Any particular reason what is driving this? Sir, it is more to do with the operating leverage and the other expenses. It has gone up purely because of maintenance-related issues, sir. Usually, we take the maintenance during an off-season. We did take the large capacity, which is at Mattapalli, for the maintenance, the annual maintenance. Coupled with that, the lower operating leverage did add up to the expense. At the end of the year, it should get aligned. The other expenses should come down as a percentage of. Yes, because those are maintenance expenditures, sir. That includes maintenance expenditure, which we did incur for this time. It should get normalized by the end of the year, sir. Sir, just one more clarification. The total incentive for Folia is expected to be INR 45 crore, of which we have already received INR 40 crore. Yes, sir. We did receive, sir. Yeah. Only an additional INR 5 crore is left for the second half. No, sir. We did receive the entire incentive of INR 46 million. We did receive INR 46 million, sir. Thank you. Thank you. We will have next question from Mr. Sukrit Patil. Sukrit, you can go ahead with your question. Good morning to the entire team. Sorry about the earlier thing. My question is, with cement demand showing regional divergence and input cost remaining volatile, how is Sagar Cements recalibrating its capacity utilization and market mix to protect margins while sustaining volume growth over the next two quarters? Yeah, Mr. Patil, we have been on the same mix for close to a decade, sir, except for one Madhya Pradesh plant and Odisha plant got added up. It's a very cyclical kind of a thing, sir. We have to live with it where the assets are. From a regional diversification, as we have mentioned, the Madhya Pradesh plant is where we are expanding. That should help us reduce the regional dependence on south. South is not always like this. Even for the past more than a decade, though the operating capacities did not change purely because of realization changes, for at least more than half of the time, the south has been extremely profitable, sir. We don't see that as a challenge. We are going through some rough weather because whenever the margins actually are healthy, some new capacities keep coming in that region. That puts pressure from time to time. Our assessment is each region has its own pluses and negatives. Given that scenario, for whatever reason, we are very south focused. We wish we want to have equal balance in all the regions, but it would take time, sir. It would take time. Given this scenario, it's a large CapEx, and it's not something which you could do overnight, or you cannot wish away things which are not good so fast. We have to live with the way it is. What we internally do is to improve the efficiencies. In spite of having low capacity utilizations, we continue to focus on cost management with a very low operating leverage, sir. Those initiatives are still on. Fortunately, in our case, the waste heat recovery at Gudipadu and the capacity addition at Madhya Pradesh should add up to our margins going forward, sir. That should help us increase our margins as we progress into the future. Just an extension to the question, sir. Since you have mentioned about the south part, in case, you know, if you are planning any entry into the northern area, northern regions, is Sagar Cements in talks with any partnership deal with any other company from that particular region or space? Yeah, Mr. Patil. Can you shed some light on that? Yeah, Mr. Patil, at this point of time, nothing has reached a significant milestone for us to announce with all the stakeholders, that includes you. We'll be the first people and happy to come back with you if anything has progressed to an extent that we should come and address to our stakeholders, sir. At this point of time, there is nothing that is happening. I think that's a very good answer. I wish you the best of luck for the next Q3. Thank you, sir. Thank you. We will take the next question from Mr. Amit Murarka. Mr. Amit, you can go ahead with your question. Yeah, thank you. Good morning. Sorry to interrupt, Amit, we can't hear you. Is it better now? Yes, you can go ahead with your question. Hello. Hello. Amit, we can hear you now. Okay, thanks. Thanks for the opportunity. Just quickly on pricing, I just wanted to understand, the pricing has actually been correcting quite consistently for the last four or five months to the point that nearly half of the 50-50 hike that we have seen in April has been taken out. I noticed that you mentioned that you don't expect any further declines. Generally, to understand why this sharp correction after the steady increase we saw in April and May, and also given that supply is kind of an issue also being there, do you think that will not be an impact on pricing in the coming quarters? Yeah, Mr. Amit, I think there is a disconnect in terms of the pricing understanding, sir. The prices significantly moved up from the middle of Q1 or probably the middle of April 2025. They moved up very well. They sustained more or less all the way up to the middle to end of July, and it got seasonally corrected, sir. There has been a drop of around 3% to 4%, sir, because we believe this is more a seasonal correction. This cannot be attributed to any additional capacity that is coming into the market. This we typically have seen even in the past. Less than 5% price correction is expected during the off-season. That's what it has been. Now, our ability to increase the price also got, I would say, limited because the season again got extended. At the same time, the GST rate correction and some amount of, I would not say confusion, but with the regulatory kind of a push-through in terms of anti-profiteering and all did not help us recover the price that we have lost. Or else by now, once the season is getting over, we should have recovered the small price drops that we see during the off-season, and it should have got corrected. Probably that correction is what we are expecting to happen by the end of this Q3, sir. We expect the demand to start picking up quite sharply from here on. The prices probably will start becoming healthier than what they are right now in our assessment, either end of Q3 or early part of Q4, sir. Even in October, right, my understanding is that the price has corrected another INR 5-10, even beyond the GST cuts we saw in September. The correction is continuing actually even in October as per the price factor. Fair enough. I can only comment on this thing, sir. The prices got corrected by that 3% to 5%, and they remain there, sir. It's not like our prices are dropping. Yes, there is some amount of information about some large non-trade orders having some price correction, but we are not in that space, sir. On the new clinker capacity, like you mentioned, the Kazoo coming up for Ramco and then UltraTech also coming up with their plant. With the 55% to 60% utilization, don't you think that these units could also kind of create some pressure in the market? I mean, I know it's a six to nine-month away situation, but it's surprising to see new units come up with such full utilizations. We have not come up, Mr. Amit, so I cannot comment much. We have to live with that. That has been the case historically in the south, so that remains so even now. The good news is that probably when they are coming up, the demand is likely to be higher. It may not significantly erode the operating capacity utilization. It may not help in increasing the capacity utilization for existing ones. Right. Lastly, on the debt levels, the clinker moved up from March 2025 level. Sir, I think these are marginal corrections, sir. As indicated, our gross debt and net debt positions may not be significantly different from what we have started, sir. That narration remains, irrespective of expansions and some amount of investments into the green energy generation, our gross debt position would remain very similar for the current year from the last year, sir. It is not very different, sir. It will remain where it is, sir. Whatever we are repaying is what we have borrowed. We are investing into the efficiency improvement as well as the capacity, sir. Okay, sir. Thanks and best wishes, sir. Thank you, sir. Thank you. We will take the next question from Mr. Deep Lapsia. Mr. Deep, you can go ahead with your question. Yeah, hello. Can you hear me? Yes, sir. Yes, sir. Thank you for the opportunity. Sir, only just one question from my side. On capacity expansion front, we are in process to commission 0.5 and 0.25 at Geerabad and Gudipadu and 0.75 at Mattapalli. Total 1.5 MTPA of expansion. From current 10.5, it is expected to reach 12 MTPA by FY27. Is my understanding correct, sir? Except for 0.25 in Gudipadu, sir, your assessment is correct because we are yet to start. Yeah, it is for FY27. Yeah, it's likely that we should reach 12 million by the end of FY27. Okay, sir. Thank you. That's it from my side. Thank you. Thank you. We will take the follow-up question from Mr. Shravan Shah. Shravan, you can unmute your line and go ahead. Hi, sir. Sir, first piece on the CapEx front. In INR 180 crore, we have already done INR 180 odd crore. In the balance, how much are we planning to do as CapEx? For next year, how much, given that this WHRS, which also, if you can explain this 4.5 megawatt at Gudipadu, why the CapEx is so much high, INR 84 odd crore? Yeah, Mr. Shravan, the CapEx, what we have indicated was around INR 360 crore for the current year, sir. It has slightly gone up, not because of anything, but we are able to push some implementation slightly ahead of time. This INR 360 crore probably should end up at around INR 450 crore for the current year. Out of that, we did INR 180 crore. We should end up spending another INR 250 crore for the current year, sir. Okay. Next year, sir, FY 2027? Yeah, FY27, we expect it to be anywhere between INR 250 crore to INR 275 crore. This includes the maintenance CapEx also, Mr. Shravan. This waste heat recovery system, why is the CapEx so high? Waste heat recovery CapEx is usually anywhere between INR 18 to 20 crore per megawatt, sir. We are very much well within that limit, Mr. Shravan. Okay, got it. Got it. It is all inclusive, sir. This includes the GST. It's the total CapEx inclusive of IDC and everything. It is well within that cost, sir. Got it. Got it. This Geerabad, we will be 0.5 million ton, will be starting in Q1 FY27 or by March FY26? We should commission before March 2026. March 2026 itself, we should have commissioned it, sir. Okay, the volume will start coming from Q1 FY2027. Yes, sir. It's a dynamic plant, so we don't expect it to have a longer kind of commissioning time. The volume should start kicking in ASAP, sir. Okay. Got it. Another thing I just wanted to understand is this quarter, in terms of whatever we are saying, 3-4% price decline. The non-trade prices have declined much higher versus the trade. Sir, in our case, the price drop is this. This includes the non-trade. Trade prices, more or less, in our own case, where net of GST, there is not much of a drop, sir. The drop is only on account of non-trade for some people. Hello. Sir, we can't hear you. Yeah. For us, the drop we have witnessed is primarily on account of non-trade, sir. Trade is only GST pass-through happened. We did not see a bigger drop in terms of the trade prices. What we hear, again, we are not in that space, some of the non-trade large accounts, we hear that price drop is more than this. Okay. For this second quarter of FY26, in terms of the demand growth for the individual state of South, if you can help us. I think if you can connect, we would be happy to share that. Okay. Got it. Just to clarify this staff cost, you said the 10% increment, and from third quarter onwards, we should see some moderation or this kind of a number will continue. Sir, the absolute number will remain like Q2 number, sir. It should be in the range of around INR 36.5 crore per quarter, sir. Okay. Got it, sir. Thank you and all the best. Thank you, sir. Thank you. We will take the next question from the chat box. Mr. Rajakumar Vedyanathan has asked, when is the rights issue planned for Andhra Cements Ltd? Also, is the company having OFS option to reduce the stake to comply with minimum public shareholding norms? Yeah, let me comment. I think we would be happy to come back at the timing. The regulations actually go all the way up to March of 2026. Yeah, we did apply and got the CEDI clearance for the rights issue. Up to December of 2025, the current application is valid. The option for an OFS also is something which we are evaluating. I think we should come back to all the stakeholders fairly soon. At this point of time, our thinking is that we should have completed this before the current financial year itself. Thank you. The next question is, any update on WISAC land sale? Yeah, I did mention, there is a slight delay because of some paperwork, some typo errors in the paperwork that was done. We do expect the clearance anytime soon. We are expecting a six-month delay from what we have indicated in terms of the sale proceeds to be received. We are expecting at this point of time a six-month delay from what we have indicated before. Thank you. We will take the next question from Mr. Satyam Kesarwani. Mr. Satyam, you can go ahead with your question. Hi sir. Thanks for the opportunity. I just wanted to ask you about the statewide mix for this quarter. Like in the last quarter, we did around 50% in Andhra Pradesh and Telangana. I just wanted to ask if it is the same in this quarter as well. The next question would be if you can share the procurement price for Petcoke since it was up for this quarter right now. Sir, I think we did indicate in our slide 15 about the Petcoke current trends. Those are the indicative offers that we did receive. If you look at our investor presentation slide 15, you would have the Petcoke pricing trends. At the same time, R1 acquisition costs. If you look at the statewide mix, sir, it is not very different from what we have indicated in the past, sir. It is very, very similar to how we have indicated from last quarter to now. The more or less the state mix are very, very same. Okay, sir. Understood. Thank you so much. Thank you. Thank you. We will take the next question from Mr. Vincent Andrews. Vincent, you can go ahead with your question. Vincent, please unmute your line and you can go ahead with your question. We will take the next question from Mr. Amit Murarka. Mr. Amit, you can unmute your line and go ahead. Sorry, I'm done with the question. Yeah, okay, fine. Vincent, you can go ahead with your question. Vincent, you are not audible. Request all participants to raise their hand if they have any questions. Okay, as there are no further questions, we will request management to give the closing commentary. Over to you, Sreekanth sir. Am I audible? Yes, we can hear you. Sorry, sorry. Thanks for the opportunity. I have only one question. See, one basic question. Like Andhra Cements Ltd, as per the presentation, Andhra Cements Ltd is now showing a beta pattern of, it is a loss of around INR 24 crore. What is the current utilization in this plant and at what utilization will it break even? What is the optimum EBITDA pattern you are expecting and at what utilization? That is why. Mr. Vincent, as indicated, it operated at 32%, sir. The operating losses are primarily on account of, you know, we actually did a shutdown for upgrading the plant. For the whole of the quarter, we did not produce any clinker, sir. We actually shut the plant. Going forward, we believe that at 50%, it should break even. At 50% capacity utilization, it should break even because the new preheater is a lot more efficient because it's energy efficient. We should have at least close to 100 kcal saving, at least for the coming few quarters. That itself should help us break even relatively faster. Just to have a thumb rule kind of a thing, at 50%, we should break even, sir. At 50% capacity utilization, we should break even now, Mr. Vincent. Yes, sir. What is the optimum utilization you are expecting? At this optimum utilization, how much would be the EBITDA pattern? See, for the next year, we expect it to reach to the optimal kind of utilization, which is close to around 60%. We should generate close to around INR 500 to INR 600 EBITDA per ton, like the average Sagar, Mr. Vincent. Thank you very much. That is subject to realization also, okay? Any change in realization could add up. Our internal, what we have penciled in is 60% capacity utilization at an average INR 600 EBITDA per ton. Thank you very much. Thank you, Mr. Vincent. Thank you. As there are no further questions, we will request management to give the closing commentary. Thank you, Vibha. Yes. We would like to once again thank all of you for joining us on the call. I hope you had all the answers to what you're looking for. Please feel free to contact our team at Sagar Cements Ltd or Citygate. Should you need any further information or have any further queries, we'll be more than happy to discuss them with you. Thank you. Have a good day. Thank you. We will now conclude the call. Thank you, everyone. Have a good day.