Ladies and gentlemen, good morning and welcome to the J.K. Cement earnings conference call for the quarter-ending 30th of June, 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 touch-tone 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.
Thank you, Ryan. Good morning, everyone. On behalf of PhillipCapital (India) Private Limited, we welcome you to the Q1 FY26 call of J.K. Cement Limited. On the call, we have with us Mr. Ajay Kumar Saraogi, Deputy Managing Director and Chief Finance Officer, and Mr. Prashant Seth, President of Business Information and Investor Relations. I would like to mention, on behalf of J.K. Cement Limited and its management, that certain statements that may be made or discussed on today's conference call may be forward-looking statements related to future developments and statements which are based on current management expectations. These statements are subject to a number of risks, uncertainties, and other important factors which may cause actual developments and results to differ materially from the statements made. J.K.
Cement Limited and the management of the company assumes no obligation to publicly alter or update its forward-looking statements whether as a result of new information or future events or otherwise. I will now hand over the floor to the management of J.K. Cement for their opening remarks, which will be followed by an interactive Q&A. Thank you, and over to you, Saraogi, sir.
Thank you, Vaibhav. Good morning and welcome to Q1 call. The Board of Directors met on the 19th of July to review the performance of the company for the quarter-ending 30th of June, 2025. The major highlights are that the net sales grew about 19% year-on-year at INR 3,028 crores, and whereas it decreased by about 6% as compared to the previous quarter. The EBITDA during this quarter was INR 674 crores and an increase of 41% year-on-year. However, a dip of 9% over the previous quarter. The comparative margins for the first quarter were 22.3% in this quarter, with 18.7% year-on-year and 22.8% in the previous quarter. The per-ton EBITDA was INR 1,247 per ton as compared to 1,014 in the previous year and 1,265 rupees a ton in the previous quarter.
This performance has been led by a 15% growth in the grey cement volume during this quarter year-on-year, which was mainly on account of substantial growth in Central India, where we grew by over 50%, and the growth in the South region, where the base was low and there has been a good growth, a good sale of clinkers during this quarter. However, there has been some growth in the North, mainly on account of the market conditions, as the North did not grow that much. If we look at the White Cement, the White Cement year-on-year grew by 8%. These are the major financial highlights. During this quarter, the company also completed a debottlenecking at Ujjain Unit, and now the consolidated capacity of the grey cement stands at 25.26 million tons.
The green power capacity as of 31st or as of 30th of June is 184 MW. The company also completed the acquisition of Saifco on the 6th of June. So now Saifco becomes a subsidiary of the company, and the management of Saifco has been taken over. Now the company is working on improving the performance of Saifco in the Jammu and Kashmir region. The 6 million-ton greenfield and brownfield expansion is on track. The integrated unit at Panna, where we are adding a 4 million-ton clinkerization unit, is on track. The brownfield grinding locations of one million each at Panna, Hamirpur and Prayagraj are on track. Even the greenfield site at Buxar in Bihar is on track. By the end of this calendar year, mostly we should be able to start and complete the expansion.
Looking to the growth in the putty volume and to meet the peak demand, the board also decided to go in for expansion of putty by 6 lakh tons with a total capital outlay of INR 195 crores. This will be set up in Rajasthan. This is to meet the growth of putty. The balance sheet position is that the gross debt as of 30th of June stood at INR 5,203 crores as compared to INR 5,101 crores as of 31st March. The cash was INR 2,407 crores as compared to INR 2,536 crores. The net debt was higher at INR 2,796 crores as compared to INR 2,565 crores as of 31st March. The net debt to EBITDA as of 30th of June, however, was 1.29 as compared to 1.30, and the net debt to equity was 0.44 as compared to 0.42.
These are the major highlights of the performance during the quarter. I will be happy to address your questions. Thank you.
Thank you. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press star and one on their touch-tone 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. Ladies and gentlemen, if you wish to ask a question, please press star and one. The first question comes from the line of Amit Murarka from Axis Capital. Please go ahead.
Yeah, hi. Good morning. Thanks for the opportunity. So firstly, on the Panna line, it was a 3.3 million-ton line. I just wanted to understand why and how did it expand to 4 million tons given that we are so close to commissioning.
No, no. It was always at 12,000 TPD.
Was it? Because I think the Q4 PPT still mentioned 3.3, and in this quarter only it was mentioned as 4, actually.
Okay.
The 4 million ton clinker capacity. Okay. Fine. Fine. Because I think it was initially announced as 10,000 TPD, what I remember, and even the Q4 PPT mentioned it.
Sorry, maybe that is because 10,000 TPD was the increase from 8,000- 10,000 for line one, which we did about a year back. But this has always been 4 million tons.
Okay. Thanks for the clarification there. And secondly, could you let us know what was the incentive booked in the quarter?
Yeah, Prashant?
Yeah. Incentive for the quarter was INR 850 million.
Okay. So I believe last quarter it was mentioned as INR 75-INR 80 crore range. So the new booking of incentives have come up this quarter, even though volumes are lower in Q1.
No, that was what happened that in the previous quarter, Aligarh unit, where it has an overall ceiling. So that ceiling got exhausted by Q3. So there was no subsidy for the Aligarh unit in Q4.
Okay. Okay.
There's an annual cap on subsidy also.
Sure. Could you help us understand what are the various incentives on which plants basically are earning incentives right now, and how long will they continue, these incentives?
So the incentive, we are getting one incentive in the North, which is for Nimbahera line three, and that would only be available in this fiscal. So that will get concluded. Otherwise, we are entitled for subsidy for the three grinding locations, Aligarh, Hamirpur, and Prayagraj. Aligarh also, I think, is only one year left because it was for seven years. It was commissioned in 2020. And then we are getting for Ujjain, and also in case of the Panna unit, integrated Panna plant.
Sure. Understood. So Hamirpur also has it, isn't it?
Yes. Hamirpur, Prayagraj both have.
And Panna also, and Ujjain also.
Yes.
Given that these are newer units, fair to assume that these incentives will continue for a few more years?
Yes.
Sure. And lastly, just very quickly on other expenses, that was also quite low in the quarter. So could you help us understand what are the plans for marketing spends and all which are low in the quarter?
So, actually, it will be higher going forward because all our major marketing spends, we have these dealer tours and all. So, normally, we plan the tours, everything in the second quarter, which is the lean period. So, the marketing, the other expenses will increase sequentially. So, this is what we see that this second quarter would be a tough quarter where there is also scheduled maintenance of the kilns as well as the branding expenses pre just the festive season. So, all that gets started in this season. So, we would be seeing an increase in the expenses in Q2.
Thank you. Thank you so much for the detailed explanation. We'll come back. Thank you.
Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. The next question comes from the line of Devesh Agarwal from IIFL Securities. Please go ahead.
Thank you. Firstly, congratulations, sir, on a good set of numbers. I just wanted to understand, firstly, what would be the regional breakup of volume, sales volume for 1Q?
No, sir, regional broadly, we are not sharing the regional numbers.
So broadly, we also held, even if you gave in some.
No, broadly, we have given what has been the trend of increase in volumes as we saw in Central, a growth in volumes of over 50% and growth in the South because of a low base. All these numbers we have, but we are not sharing the exact regional numbers.
Sure, sir. And sir, the kind of capacity addition that we saw through debottlenecking in Ujjain, 1.5 million tons, what would be the potential at your other locations where you can increase capacity by debottlenecking?
As a part of the expansion in Central India, a one million-ton capacity is being increased at Hamirpur and Prayagraj. That is one which is part of the expansion plan. We see that there is a potential in the South of about 0.7 million. We are just working on that.
All right, sir. And you mentioned in South, we had a Clinker sale this time. Could you quantify how much was Clinker sale?
Clinker sale has been much higher than the previous quarter.
No specific number?
No, no specific number.
Sir, for your recent acquisitions, both Toshali and Saifco, what are the plans? Do you see any big opportunity there in terms of capacity addition, or it will take time?
So we see an opportunity. I mean, one, as we said, in Toshali, we are still working out on the mining lease, which we have not been successful so far. And we are also evaluating an alternate option of a long-term tie-up of the raw material with the government of Odisha or identify certain areas and if something comes for auction. So that is the potential. And there, as we said, if the limestone tie-up is done, we have an opportunity of about 2.5-3 million tons. As regards Saifco is concerned, yes, we see an immediate opportunity for upgrading the kiln by about 300-400. It operates at about 600-650 tons per day. We see an opportunity to 850-900 TPD per day. So that is an immediate opportunity.
But it has good limestone reserves, and we are working out on the possibility how if and that we will take maybe a year down the line, work out through the market situation, how we settle. But we have the limestone and other facilities, so there is an opportunity of expansion up to 2-2.5 million tons in that region.
All right, sir. And sir, post the Q1 where you have delivered such strong volume growth, what would be a guidance outlook for FY26 as a whole in terms of volume growth?
We're given a guidance of about 20 million in this financial year.
Okay. So you'll stick to that, 20 million tons?
Yeah.
And finally, one last one, sir. In terms of your post Panna expansion, where do you see the next leg of expansion, the three places that you mentioned, Jaisalmer, Odisha, and Karnataka? Any progress that we have made, and do we have visibility that next expansion will be taken at a particular location?
Yeah, we are working out. We are close to finalizing, and we shall be putting up our options to the board very soon. And I think within very shortly, once we board approve could be guided towards because we've done Central, so more towards the North. But we are just so very soon, once we are through with all the numbers and options, we'll put up to the board and get back to you.
All right, sir. Thank you so much.
Thank you. To ask a question, please press star and one. The next question comes from the line of Vishal Biraia from Bandhan Mutual Fund. Please go ahead.
Vishal, I do apologize to interrupt you, but your audio is too low. Could you please use your handset?
Is this better?
Yes, please go ahead.
So just wanted to confirm the clinker capacity at Panna. After this expansion, we would be at about would that be the right number?
Pardon, Prashant, you answer. You can just.
So I could not hear what number he spoke, actually.
After the expansion of clinker at Panna, what will be the capacity of clinker?
19 million tons.
No, at Panna itself. Panna will be.
7.3 million tons.
7.3 million tons. Okay. And total clinker after the commissioning of the Saifco plant, including that, we will be close to 18 million tons at the end of 2026? At March 2026, this financial year?
No, no. 19, I am saying on a standalone basis. Then Saifco is in the subsidiary. Saifco and Toshali, if we add, then it will be close to 19.6 million or something.
And just to reconfirm the number for grey cement, this year, after we commission all the GUs that you talked about, we'd be close to 32 million tons capacity?
Yeah. So we are already 25.26 million tons, and six million tons is average, so we'll be 31.26. We have certain opportunities in the South, which we are working out, and if that materializes, it will be 32 million tons by FY26.
Okay. Okay. Just some basic questions on paint. What is the cumulative investment that we have done in paints, and what is the capacity that we've created as of now?
So the capacity, Prashant, you can answer this.
We have 60,000 kiloliters of capacity, and our investment total is close to 450 crores.
450 crores. Okay. And how much incremental do you plan to do with?
We have an approval of INR 600 crores, so the remaining would only be restricted up to additional 150.
By when should we see that coming in?
FY27.
Okay. Okay. Perfect. Thank you.
Thank you. To ask a question, please press star and one. The next question comes from the line of Navin Sahadeo from ICICI Securities. Please go ahead.
Yeah. Good afternoon, sir, and thank you for the opportunity. Also, congratulations on a good set of numbers. My first question was on volumes. So you said that Central India has done much better. So is it that the industry itself had fairly strong growth, or we have expanded our dealer network much further to take care of the upcoming expansion beyond the eastern part of the region? So before the grinding units come up, have we already started feeding those markets? What's my question?
Yeah. We have already started feeding with the expansion in Bihar. And so it is we expanded. First, we put up four million, then we expanded it to six million, and now adding another six million. We have already doing a good volume in Bihar. We have entered Bihar, and hopefully, end of this fiscal exercise, we should be doing about close to a million tons maybe in Bihar.
Understood. Understood. And before the next question, I just want a clarification. You mentioned after because in the previous participant asked post expansion, what will be the total clinker capacity in Panna? And Prashant sir said 7.3. Shouldn't it be eight because four is what we have already done with line 1, and second line is four? So it will be eight million ton, or am I missing something there?
No, no. Line 1 is 10,000 TPD per day, and line 2 is 12,000 TPD per day.
Line 1 is 3.3 million.
Understood. Understood. That's clear. And sir, you also mentioned the potential of debottlenecking in South by about 0.7 to 1 million ton. So will it also be backed by some sort of a clinker debottlenecking there, or it's more on the blessing from the government?
Yeah. So we are working out on debottlenecking in South and other regions. Maybe we feel that about 0.7-1 million could be able to achieve by debottlenecking at all locations, and there will be some debottlenecking both on the clinker side as well as cement grinding.
Understood, and sir, my last question, if I may, margin in white is what I wanted to just point out because I believe sequentially there has been a pretty sharp drop in the white cement realization, if I understand this correctly, so has it also led to a sharp margin decline in the segment, and how should one then look at this segment given we are now looking at investing more capacity or more capital to put up a putty grinding unit in Nathdwara?
So see, as far as margins, yes, the white cement, we have seen the margins declining sequentially, but I think now, as we see, it has stagnated. There is no further measured dip in the white cement margins. It's ranging between 15%-20%. And we feel that it will continue to be in that region.
The investment is necessary to ensure that we maintain our market share. Otherwise, today, last year, this year, our targeted volume is about 1.1 million. The peak season, the festival becomes closer to Diwali, is always the peak season. Then we have peak season before the year-end where to meet out the peak. The present capacity is barely able to meet out the peak season demand. In fact, we have already started some volumes on tolling to meet the peak season demand. We are envisaging a growth in the putty segment of between 7% to 10%. With that growth, keeping that growth in mind, we will need additional capacity.
Excellent. So just one last question about potential expansion plans. Now, I understand there is a vision to reach up to 50 million tons, and you've highlighted that in similar calls in the past. But with now our EBITDA averaging almost nearing to INR 3,000 crore or anywhere between INR 2,500-3,000 crore annually, will it be fair to say that we can handle two projects at a time? Is the company really thinking on those lines that apart from one project, we can also look at having not just doing one project at a time, but can we look at doing two projects at a time? Is the company thinking on those lines so that growth can come in faster?
Yes. Right, the company is thinking. Earlier, we were actually taking projects after completion. So there was a gap maybe about two years. So 18 months when the project was getting completed, then we used to take up the next project. Now, with our capacity reaching 30 million tons and the cash flow supporting for the investment, and with a view that we get to 50 million tons by 2030, I think we could be, in a way, adding up a project, announcing a project every year. So this would mean that there would be two projects going on at a particular time. It's not that we will not be announcing two projects at one time, but in between, when we have already started work, we'll take up the next project, not wait till completion of the project.
Yes. This is so great. Thank you. Thank you so much.
Thank you. To ask a question, please press star and one. The next question comes from the line of Sanjeev Singh from Motilal Oswal Financial Services Limited. Please go ahead.
Good afternoon, sir. Thanks for the opportunity. If we exclude the clinker volume in 1Q, so how was the cement realization movement compared to last quarter? So basically, I want to understand how have been the price movements in different markets where we operate. And compared to 1Q, how have been the prices now?
So you see, the prices on an average have been more or less flat because there has been an increase in the South realization in this quarter. So the South has compensated, though in the North and Central, there was a marginal pressure, but not much. And even now, up till now, it's not much changed, except a few, it's very marginal. So it is not having any significant drop in pricing or anything. But still, we have another one and a half months to at least till end of August to see for the monsoon. We have to see that. And we are hopeful, I think there could be only there should not be any major dip in the pricing. Yes, definitely, there is some pressure which is leading to some reduction in the non-trade pricing. But beyond that, as of now, it is not much.
And secondly, in this quarter, we have a spend closer to INR 350-400 crore market. So how should we look at full year numbers in FY26? Will it be closer to INR 1,700 crore? And also, if you can guide on FY27 numbers. Thank you.
So this will be this year, it will be close to INR 2,000 crores. And I mean, next year, presently, we have the plans for the normal CapEx and the putty expansion what we have announced. So for all that, it should be close to INR 600 crores as of now.
Got it, sir. Thank you.
Thank you. The next question comes from the line of Rishikesh from Kotak Mutual Fund. Please go ahead.
Hi. Good morning. Possible to share consolidated gross debt and net debt?
Rishikesh, the numbers are same because on the console, we don't have the borrowings, and cash is also not there.
Okay. Okay. And secondly, Mr. Saraogi spoke about the company being comfortable taking probably two simultaneous expansions. So is there any internal thought in terms of what could be the potential borrowing we could be comfortable with or probably cap our borrowing in terms, probably any metrics on debt to EBITDA, anything on that line?
So on the net debt to EBITDA, as we said, today we are at about 1.3. Net debt to EBITDA, we are very cautious that whatever expansions we do, we try and keep the net debt to EBITDA to or below 2.
Okay. Thank you. Thank you. The next question comes from the line of Ritesh Shah from Investec Capital. Please go ahead.
Hi, sir. Thank you for the opportunity. Couple of questions. Sir, can you give the total number for paints, grouts, and adhesives? And if you could break it up, that would be great, along with the EBITDA that we clocked in the last fiscal?
No, the paint numbers are there. The grout numbers, grout is not part of paint. So we will give you the paint numbers. Shan, that can be shared. You can give the paint numbers.
The paint numbers have already been shared last quarter. We did INR 273 crores of the turnover of the paint in the last fiscal. And this quarter, our paint turnover is INR 86 crores.
And, sir, margins?
Paint is about.
Gross margin in paint is about 30%.
Sir, 30% EBITDA margins?
Gross margin.
No, gross margin.
Gross.
Investment in EBITDA margins, no paint company.
No, EBITDA also, we shared the numbers. So I think 45 crores of the EBITDA loss last year. And this quarter, it is 10 crores of the EBITDA loss.
Okay. That's useful. Sir, secondly, Saraogi sir, you mentioned that North and Central, there was a marginal pressure in pricing. However, in South, the prices actually increased. Sir, how should one understand this dichotomy in pricing?
So I think, see, we have to wait. We have to see what really happens in the monsoon. The monsoons are now, as I said, that there has been some pressure on non-trade pricing, marginal pressure on trade pricing, but not significant enough. But we still have to wait and watch.
Okay. Sure. Sir, in the annual report, you do make a mention of LC3 and PLC. These are two different types of cement, I presume. Sir, what are our plans over here, and how should we understand this?
Well, it is still at a very initial stage. We are working on it. And we see on LC3 and what can be done. So it is still at a pilot stage, and then we are just working on it.
Sure. And sir, last question. Do we utilize synthetic gypsum? If yes, what is the differential or the cost arbitrage that we derive out of it?
So, gypsum, we have various mix across. And depending on availability and mixing of gypsum, we use many various. Even imported gypsum, chemical gypsum, we are using local mineral gypsum, which is available from the mines. So we use a combination of different products.
Sir, my question is, do we manufacture anything captively, or do we?
No, no. We are not manufacturing anything captively. No, no, nothing.
Okay. And sir, what was the price gap on imported synthetic gypsum versus what we get from hypothetically, say, Rajasthan State Mines and Minerals, something RSMM, adjusted for the grade? Is there an element of cost savings over there?
Yes. See, again, the purity part, there is a difference. It affects when once you use an imported gypsum, which is definitely very costly. But again, it helps reducing the clinker consumption and using more fly ash. So it does help. So we only see the thing only on a totality basis. The gypsum cost may be higher, but the overall cost economics is different.
Sure. And sir, just last question. You indicated that we did certain tolling volumes in peak season for putty as a possible if you could quantify the number for full year last year?
Last year, the tolling, I don't have the exact number available with me, but I think it was around 50,000 tons or something. I will get back. I don't have the number. Prashant, do you have the number?
No, we don't have the last year numbers now.
I will share you the exact number.
Sure, sir. Thank you so much. All the very best. Thank you.
Thank you. We take the next question from the line of Parvez Qazi from Nuvama Group. Please go ahead.
Hi. Good afternoon, sir. Congratulations for a great set of numbers. Just two data-specific questions. What was our white share this quarter and also the fuel mix this season? Thank you.
Fuel mix was like 60% petcoke in this quarter.
What was the rail share?
Rail share was 11%.
Perfect. Thanks and all the best.
Thank you. The next question comes from the line of Girija Shankar Ray from YES Securities. Please go ahead.
Good evening, sir. Thanks for taking my question. So just wanted to check. You said if we use imported gypsum, so that is going to increase your fly ash percentage, and it will reduce your clinker consumption, right? So actually, this time, how much is the percentage of the fly ash in the total clinker consumption?
I mean, see, we can go up to fly ash up to 35%. But this is 35%. We can go up to that.
But it is right now where our fly ash % is below 35%, you are saying?
Yeah. It depends. It's on an average when we talk about. It depends on the location and grinding location when we are talking. It means grinding location where we are getting what gypsum is available. So it helps in that.
Okay. And my next question is with relation to power and fuel. There is a sharp increase in power and fuel costs in quarter-on-quarter basis as well as for the freight cost. And so we didn't see any kind of saving in freight cost. Any particular reason in that?
No, see, power and fuel cost increase means there are two reasons. One reason is because of the increase in the petcoke price, which the average consumption rate has gone up. And second is the balanced clinker production in this quarter. I mean, if you are comparing QOQ basis, so last quarter, it was low because we consumed some clinker from the stocks. And this quarter, the clinker production was balanced. So these are the reasons for increase in the power and fuel cost. And freight cost increases like our lead has gone up by two kilometers because of seeding the Bihar markets and all that. And that has resulted into a per tonne freight increase by around, say, INR 5-INR 6.
Okay. And then the last question would be for the. You mentioned in your opening remark, Central India has done well. So is this good? So we have done it. On a company level, this is good for our company or overall industry has done well in Central India? And what was the percentage you mentioned? I forgot.
It's over 50% in Central India. This is because we are opening up the entire market. We are trying to grow our market share across the entire UP, MP, and also enter the Eastern region through Bihar grinding, which is coming up. A new capacity is going to come up in the next few months. Maybe just six months down the line, we'll have a new capacity coming up. Unless we have to strengthen the entire region. Otherwise, how will we be able to supply materials from the new plants?
Fair enough. Fair enough. Thank you very much. But the last question is, can you give us the regional capacity operation if you can provide us?
No, no. We are not sharing regional capacity operation numbers.
Not on this. Thank you very much, sir. Thank you very much.
Thank you. The next question comes from the line of Shravan Shah from Dolat Capital. Please go ahead.
Hi, sir. First of all, congratulations on a great set of numbers. Most of the questions are answered. A couple of things to clarify. So first, on the cost saving, what we have talked about last time, INR 150-INR 200 over the next two to three years, and this year, FY26, on an average, we were looking at INR 40-INR 50 per ton. So that remains intact?
Yeah, yeah. That remains intact. We will be enjoying this fiscal at about INR 40-INR 50 rupees in terms of cost saving.
Okay. Great. And in terms of the green share, which is currently at 52%, so that we will be reaching to 60-odd% by end of FY26.
Yeah, yeah. So on the Green Power also, which is again as a part of cost savings when we say, so we should be closer to 60% by end of this fiscal.
Okay. Great. Second, sir, once this 6 million ton will start by end of this December, so is it fair roughly to say in FY27, one can see incrementally close to a kind of a 3 million ton volume from that? One can look at kind of a 50% utilization. Is that a way one can look at?
Definitely. That will be, it's too early to say, but definitely, this is where we are working at, and closer to the end of this fiscal, and we try, definitely. We are working towards that direction only. Whether it is 23 or it is 22.5, we'll just work out and.
Yeah. Actually, there will be some setup of the quantity, which we are already seeding into that market. In Bihar, already we have reached a particular level. So for reaching the 50% utilization, now the fresh volume has to come up to that extent.
Got it. Then secondly, sir, last time we had talked about that the UAE plant is likely to kind of clock a quarterly EBITDA of INR 15-20 odd crore. So for this quarter, is it we have already reached to that EBITDA of positive INR 15-20 odd crore?
Yes, yes. We have already reached, in fact, this quarter. The Fujairah working, I think for the year as a whole, should be around INR 80 crores or so, INR 80-INR 90 crores.
Great. Great, sir. Great. Second, on the paints, whatever we have said in terms of the revenue target INR 44-odd crore in FY26 and INR 600 crore FY27, and break even by FY27, that remains intact?
Yeah. Yes, that remains intact.
Okay. And then lastly, if you can help us, as you have said that the other expenses, so one is marketing, second maintenance, and Q2 will increase. Any idea? Is it fair just a 40-50 crore QOQ increase? That's the way one can look at?
Yeah. It could be around that region. No exact numbers are not, but yes, you're right.
Thank you. Ladies and gentlemen, a final reminder. If you wish to ask a question, please press star and one. The next question comes from the line of Tejas Pradhan from Citigroup. Please go ahead.
Yeah. Hi, sir. Could you share what would be the industry volume growth for the different regions you operate for the first quarter? Because you mentioned North, there was some degrowth, right? So how would it be for all the regions?
So we have to get the industry numbers as yet. We are not getting, I think, industry numbers. We will know very soon. I think we are on.
But in terms from your side?
No. See, I think overall, we would be over 10% industry growth. But normally, when we see each region, we are able to maintain our market share. It's not that we have lost market share in any of the regions. In fact, we have actually improved upon our market share, definitely in the Central and North and other regions. We have not lost the market share. The North market is that the growth has not been in that the market growth is the major concern.
Sure. Sure. Thanks. And lastly, for the putty expansion, assuming the current profitability in that business, what would be the rough IRR that would be there from the expansion project that you have undertaken?
IRR will be over 15%.
Okay. Sure. Thanks. Thanks.
Thank you. The next question comes from the line of Prateek Kumar from Jefferies. Please go ahead.
Yeah. Good afternoon, sir, and congratulations to this. My first question is on clarification on incentives. So based on current index, around INR 300 crore kind of incentive is expected for the next three to five years based on your expansion plan.
Yeah. Yeah. This is what we see. Yes.
Okay. Next question is on your Central expansion. So incrementally, again, your Trade segment has sort of been stable currently. But the incremental volumes in Central, is this non-trade trade going to change, which may impact your profitability in the market, or how do you look at it?
No, see, incrementally, yes. Today, say, for example, from Bihar, because the grinding unit is not there, so we're not doing much of non-trade. But definitely, there will be some non-trade volumes coming up. But I think we are fairly confident we will be able to maintain the trade-non-trade ratio.
Last question on your white segment. So the expectation of finishes and paint volumes going after your, I mean, customer base, has that happened or is going to gradually happen over the next couple of quarters?
It has not. I think they just start hitting us mainly from Q3 onwards. So they are about to, I mean, they are doing the trial runs what we have heard. So I think they'll be gradually because even the orders, I mean, they are reducing the orders from Q3. So we will see that the number in the white segment from Q3 onwards.
Just one last question, if I may. The cost of sales of traded goods was a much higher number at INR 1.5 billion this quarter. It has ended up around INR 1 billion. What is the reason around that?
So traded goods, actually, we are getting a lot of pulling for all our value-added products, including paints. The traded goods in the standalone is coming, whatever is being manufactured because the platform of J.K. Cement is being used. So when there is a platform of J.K. Cement used in standalone, it is the goods which gets transferred from the Maxx factory. And in J.K. Cement standalone books, it is a purchase of traded goods.
Sure. Thank you. That sets us now there.
Thank you. Ladies and gentlemen, in the interest of time and fairness to others, we request you to restrict to one question per participant. The next question comes from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Yeah. Hi, sir. Good afternoon. Congrats on great set of numbers. My first question is predominantly on this volume guidance which you have given, 20 million tons. That remains or there is an upward bias given that the strong volume growth kept delivered in Q1?
So we still take 20 million alone because we have our lean period. We have to see when monsoon is a lean period, we have to see how the growth remains in that. But as of now, we stick to the earlier guidance of 20 million.
Just a follow-up question. See, there's a lot of capacities which are coming up in our Central and East markets. What is the outlook given that you are also bringing up almost 6 million ton capacities across the Central and the East markets?
Yeah.
So what is your outlook on the pricing trend for next one, two years given that there are simultaneous ramp-up of various capacities over the next one, two years?
So, see, one, the market is also growing. If you look at the total growth in the market, I mean, see North and Central being sort of a twin market. If you look at the overall growth in that market, there is an incremental requirement in that market of about 12-15 million tons. So as the capacity gradually ramp up, we don't see. Yes, there could be some periodical impact, but otherwise, we don't foresee any major competitive intensity which may affect the profitability.
Thank you. The next question comes from the line of Alok Shah from SRE PMS. Please go ahead.
Am I available? Hello?
Yes, Alok. Please go ahead.
So I just want to understand the reasons of increasing the green power by 20% this quarter. And is this sustainable for the current fiscal year? And secondly, that we have targeted for 75% of green power by green power share. Any guidance of EBITDA increase that we can expect within percentage of? Can you just give a ballpark number?
So we expect that with the present prices continue and prices continue to, I mean, if they further increase, then definitely the EBITDA should also be increasing. As regards the green power, definitely 75% we have given the target for 2030. We would be closer to 60 by FY26. And the plans which we have, I think this target will be met well before 2030.
Thank you. The next question comes from the line of Rahil Shah from Crown Capital. Please go ahead.
Yes. Hi. Good afternoon. My question is also pertaining to the EBITDA per ton, combined EBITDA per ton outlook. If you can share something on that.
Okay. I think we already have given my views on that.
Yes. Any certain number you'd like to give out for the full year?
No. See, I mean, we have to see when I think number would be in line with the industry growth, I mean, rather than we give any particular number.
Okay. All right. Thank you.
Thank you. The next question comes from the line of Siddharth Malhotra from Kotak Securities. Please go ahead.
Just a quick question. I know in our annual report that we signed an agreement with GMDC for 360 million tons of limestone reserves. Could you just elaborate on our plans pertaining to that particular limestone? Will that be used in some of our existing plans? Will we plan some additional new plans in the western region perhaps? What is our end goal for that 360 million tons?
So, and we have entered, we have bought a limestone reserve and an agreement for that limestone. We will see if that will help us in our future expansions. Immediately, we do not have any plans. So, as we plan, when we as a first step, we have a plan for a 50 million ton expansion to reach 50 million tons of capacity. And as we are working towards that, then we have to go in the next two years' time, we have to come up what will be our next goal of plans. So, it may, you see, unless you have a tie-up of limestone deposits, you cannot make any concrete plans. So, this is for a long-term plan. So, we continue to apply for potential limestone reserves once because as of now, we have plans to go organically. We don't have any plans to go inorganic at all.
Okay. Understood, and just with reference to the location of this limestone, are there any plans on the anvil for expansion into the western region, more particularly Gujarat?
Yeah. That could be. I mean, as of now, we don't have any immediate plan to invest in there. But going forward, maybe yes.
Okay. Thank you. Thank you.
Thank you. The next question comes from the line of Parth Bhavsar from Investec. Please go ahead.
Hi there. So thank you for the opportunity. So I have just one question. I wanted some color on non-trade demand. So if you see even year on year and quarter on quarter, non-trade share has increased for us. So I wanted a sense on demand of non-trade segment and also the pricing. Has it been more stickier than trade segment or even the price hikes have been more higher than the trade segment? Yeah. A color on the non-trade segment.
So see, again, as government spending is there, so the demand, if overall demand increases only in the non-trade segment, then to maintain the market share, we will have to enter that segment and get, I mean, otherwise, it will be very difficult to get the entire growth from the trade segment. As regards to pricing, the non-trade pricing has been also because it becomes quite intensive sometimes and very aggressive, and the prices do fall. But with this, there has also been increase in the non-trade pricing over the last two, three months when we have seen the increase in the trade pricing because the pricing of both trade and non-trade have to increase in tandem. The differential cannot be very high.
So what would be the differential right now versus what it was last year?
Normally, the normal trend is of the difference between trade and non-trade is about INR 20-INR 25 a bag.
Okay. And this has been stable ever since last one year, one, two years?
No, it has not been. So whenever the difference has been, it has been fluctuating. So that definitely affects as we have seen that in the past, the trade prices were going down. The differential between trade and non-trade has also increased sometimes even up to INR 40, INR 50, INR 60 a bag. Sometimes it can go in particular regions, INR 70, INR 80. So it is quite fluctuating.
Perfect, sir. Those are my questions. Thank you.
Thank you. The next question comes from the line of Amit Murarka from Axis Capital. Please go ahead. Amit, if you can please.
Yeah, I'm there. So just kind of follow-up question on those volumes. You mentioned that you are scaling up your volumes in Bihar as well. And there is a new grinding unit of 3 million, and that will come up over there. So will this new grinding unit have incentives as well, particularly as we have already scaled up decent volumes over there?
Yeah. The grinding unit, there is an incentive scheme. And once we commission the grinding unit, so we have already applied, and we should be getting certain incentives.
Thank you. Ladies and gentlemen, we take the last question from the line of Ritesh Shah from Investec Capital. Please go ahead.
Yeah. So just a quick one. Would it be possible for you to quantify the trade and non-trade price gap in north, central, and south?
No. So it varies from time to time. It's very difficult. As I say, average 20-25 rupees is a normal trend. But when the prices fluctuate, it gets quite different from time to time.
Okay, and sir, would you like to put any timelines on the Jaisalmer optionality that we have?
Yeah. The timeline, I think, I mean, whatever options are there, you should within very soon, I think the management should take a call on that and put that to the board.
Thank you. Ladies and gentlemen, we take that as the last question and conclude the question and answer session. I now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital (India) Private Limited for closing comments.
Yeah. Thank you. On behalf of PhillipCapital (India) Private Limited, we'd like to thank the management of J.K. Cement for the call. And also, many thanks for participating in the call. Thank you very much, sir. Vaibhav Agarwal concludes the call. Thank you.
Yeah. Thank you, everyone, for joining the call. Thank you.
Thank you.
Have a good day.
Thank you, sir. On behalf of PhillipCapital (India) Private Limited, that concludes this conference. Thank you for joining us. And you may now disconnect your lines.
Thank you.