Ladies and gentlemen, good day and welcome to the JK Cement earnings conference call for the quarter ended June 30, 2024, hosted by PhillipCapital (India) Private Limited. As a reminder, all participant lines will be 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 an operator by pressing star then zero on your touch-tone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital (India) Private Limited. Thank you, and over to you, Mr. Agarwal.
Yeah, thank you, Sagar. Good evening, everyone. On behalf of PhillipCapital (India) Private Limited, we welcome you to the Q1 FY 2025 call of JK Cement Limited. On the call, we have with us Mr. Ajay Kumar Saraogi, Deputy Managing Director and CFO, and Mr. Prashant Seth, President, Business Information and Investor Relations. I would like to mention, on behalf of JK 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 based on current 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 these forward-looking statements, whether as a result of new information or future events or otherwise. I will now hand over the floor to the manager of JK Cement for the opening remarks, which will be followed by any type of Q&A. Thank you, and over to you, Saraogi, sir.
Thank you, Vaibhav . Good evening and welcome to this call for Q1 results. The Board of Directors met on 20th of July to review the working for the first quarter ended 30th June, 2024. The major highlights are that the net sales for the quarter was INR 2,555 crores as against INR 2,856 crores in previous quarter, a drop of 11%. However, the same was about 1% higher on year-on-year basis. The year-on-year number was INR 2,541 crores as against INR 2,551 crores in this quarter. The EBITDA during this quarter was INR 479 crores, a drop of 13% as against 548 in the previous quarter. However, the same was up by 19%, and year-on-year it was INR 402 crores. Margins, comparative margins are this quarter, it was 18.7%. Previous quarter, 19.2%. Year-on-year, 15.8%.
The profit before tax is INR 292 crores in this quarter as against INR 358, a drop of 19%, up by 51%, and as it was INR 194 in previous year. The profit after tax was down by 14% at INR 203 crores as against INR 236, and up 60%, and previous year it was INR 126 crores. The EPS for the quarter was INR 26.2, previous quarter 30.5, and last year it was 16.3. These are the major financial highlights. If you look at the business performance highlights, the grey cement volumes grew by about 6% year-on-year. Central India expansion achieved 93% capacity utilization. We commissioned a 2 million tons greenfield grinding unit at Prayagraj of 2 million tons, and this was completed in record time of 10 months from start of work.
As far as the expansion is concerned, of 6 million tons, which is our journey for 13 million tons by FY 2026.
So we are already now at 24 million tons, and the work on the 6 million tons, which is at Prayagraj, to set up the clinkerization unit line two at Prayagraj, and brownfield expansions at Prayagraj, Hamirpur, and Panna, whereas a greenfield expansion in Bihar. So at Panna, the work has already started. We are on stream. The orders for main plant and equipment have already been placed, and we expect that in third quarter, FY 2026, this should get commissioned. Similarly, in case of the grinding unit at Bihar, the greenfield grinding unit, we have just finalized the land acquisition, now moving in for the various approvals. In the meantime, we have already placed orders for main plant and equipment, and we are hopeful here also that we should be able to start work post monsoon and then complete within the time schedule along with the main plant.
That was the major highlights of the working. If you look at the balance sheet, then our gross debt was INR 4,515 crores, and the net debt was INR 2,830 crores, and net debt to EBITDA was as of 30th June is 1.36. That is the major thing on the balance sheet. If you have any questions, we'll be happy to address the same. Thank you.
Thank you very much. We will now begin the Q&A session. Anyone who wishes to ask a question may press star and one on their touch-tone phone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The next, our first question is from the line of Amit Murarka from Axis Capital. Please go ahead.
Yeah, hi. I would like to thank you for the opportunity. The first question is on cost. Your other expenses, as well as your raw material cost, have dropped a lot in this quarter. Could you help understand what the reasons for this drop?
So the other expenses are lower because we are yet to. If you look at quarter-on-quarter, last year there were certain annual adjustments that were pertaining to S/4HANA, certain expenses which we had done. And the branding expenses, whatever is our branding plan, that to take off is still not there. Mostly the branding expenses we shall be taking up beginning this quarter and in Q3. So that will be the major branding spend. All the annual dealer tours and all will be done in this quarter. So it is actually a timing difference, you could say.
As regards to raw material, Amit, actually, the volumes are down by around 7% in this quarter. Second, there was some extraordinary item which was in the purchase of traded goods and in the sales also in the previous quarter, amounting to around INR 30 crores. That is the impact in the raw material cost.
Got it. Okay, sure. Also, in the annual report, I think this time you have laid out a plan to double capacity, I think FY 2029, FY 2030. And you've laid out some units also , Muddapur and Odisha and all. So could you just set up, I mean, explain the priorities as to what will be the order of expansion, if you have any in mind?
So see, as of now, we have not chosen which would come first. But in all likelihood, the North as a step because we feel that Jaisalmer unit line one may be the first one to come up, which may be followed by Karnataka. And then afterwards, it could be Panna line three and followed by, I mean, along with Panna line three, it could be Odisha. Whatever the four options which we have given how we will reach around 45-50 million tons, it will be in that sequence.
Sure. Land is in place at every location, right?
No. See, Jaisalmer, yes, the land is in position. In case of Karnataka, it is a brownfield expansion. Again, in case of Panna, it would be a brownfield expansion. In case of Odisha, also the land is there. So for all the clinker units, I think I would say the land is already there. If going forward, we may have one or two more grinding stations. That land is still not there. That we will go as we are already planning for that. But that land, pending the grinding locations, all other land is in position.
Sure. And also lastly, on the Odisha unit, I believe the limestone is not owned by you or lease is not with you. You have an arrangement of purchase. So you were saying that you would be working to get the lease in your name. So is there at least a progress on that?
No. So actually, there has not been much progress because of the elections. Now we had been in dialogue with the previous government. So we need to initiate the dialogue with the new government. When we would take up that, in any case, there is no, we are not going to take it up immediately. So we have a plan that by September 25, we should be able to close this in any case.
Sure, sure. Thank you very much, JK Cement.
Thank you. The next question is from the line of Navin Sahadeo from ICICI Securities. Please go ahead.
Yeah. Good evening, sir.
Good evening.
Good.
Sir, a couple of questions. First one, how far are we from ordering or considering placing the order for Jaisalmer? Because the last couple of times, my understanding was that we needed more support from state infrastructure to be developed in that belt because it's not just us. I think several other cement players have bad limestone mines in that belt. So just wanted to get a sense as to how far are we because if we can do it, then obviously other companies may also consider putting up a plant or if the infrastructure is ready for material evacuation.
Yeah. So, Navin, we are a lot of work has already been initiated over there. As a timeline, see, normally what we do is that when we take up another expansion, it is at the time of when an existing expansion is about to get completed.
So you could say that we are in July. If we have to take up Jaisalmer, the right time would be sometime end of next year or so. And definitely, while placing the order, we would see that the infrastructure, the work has begun, and it is in that stage that it will coincide with our plant commissioning. So only we will take up and we will commit. Otherwise, we have other options. We may shift to the other options for an expansion.
Yeah, certainly. I'm saying certainly a brownfield expansion is far easier and faster to convert.
But if you know, looking to the North market, there are very few sites available in the North. And the North is a growing market. So that is the only area which is now there to feed the North market.
Yeah, exactly. So that's what my question was, sir, that is it fair to say that Jaisalmer is now soon to be developed as the next?
Yeah, yeah, yeah. I would say yes. I think not only us, the other cement manufacturers who have limestone deposits over there are all pursuing with the state government. See, the state government has also, at one stage, has also granted us certain incentive schemes also, which we have put, and that has also been granted to us and to some other cement players also. So they also want that area should be developed and the manufacturing facilities should come up. One of the ways how you can develop any area is when the industry comes over there.
Understood. Understood. So my second question was on the white segment per se. So I was just observing that the volumes for the quarter have been, I think, down. Since the past two quarters, there is a degrowth of sorts seen in the overall white segment, so to say. The question was, are we growing slower than the market, or how should one look at it? And in the same breath, RAK White is now a subsidiary of the largest cement company in India. So does that have any impact or positive rub-off, so to say, positive, negative rub-off, so to say, on the prices of white cement imports into India? Thanks.
So your first question, that the white business revenues are going down, it is mainly because it's not actually volume numbers to that extent are not going down. It is the value which is going down because the putty realizations are going down. So the paint manufacturers are very aggressive, especially Asian Paints. And I would say today, Asian Paints, whatever has become the largest distributor of putty in the country. So the position which we and UltraTech, sometimes we were ahead of in the putty or sometimes UltraTech was ahead. So it is now Asian Paints. And so they are really very, very aggressive in terms of the pricing and other things. The growth of putty for them is more than us, though it is not that we are also growing year-on-year.
But we are not able to, as of now. We are working out our strategies how to ensure that we grow in tandem with the competition. But at least if maybe if we are not able to catch up with Asian Paints, definitely. Otherwise, our growth will be in line with the average industry growth, or we are staying at least in line with UltraTech.
Understood. And RAK White.
As regards to your second question regarding RAK, so UltraTech had acquired a stake in RAK White about two years back. It is now that they have acquired balance 25% by which they become 54%. They were already, I mean, they were effectively in control of the plant. But now they are also with the effective equity control. So they are in terms of ownership and management, they have a control. This is definitely going forward. It would be a good sign for it. White cement has always been in a duopoly situation. But so I don't think so it is a negative thing for us.
Understood. That's helpful. Then I'll come back and queue for more questions. Thank you.
Thank you. Participants, you may press star and one to ask a question. The next question is from the line of Ritesh Shah from Investec. Please go ahead.
Hi. Thanks for the opportunity. A couple of questions. First is on cost savings. Earlier, you had given a target of INR 150-INR 200 per ton or MT 25-26. Is it possible? Is the target the same? Are we looking to upward revised the numbers over here? Secondly, if you can bifurcate it between freight, power, and fuel others. And if you can also help us understand what part of it will be achieved in 2025 and then in 2026. That's the first question, sir.
So on the cost savings, yes, we see an opportunity of what I said, INR 150-INR 200 a ton over next 2-3 years. And the areas are one, on the logistic cost, we think that we should get about, if not 50, about INR 30-40 in the logistic cost. We should get something about INR 20-INR 30 i n the power segment by increasing the green power and some in the AFR substitution. So all in all, we could get anything ranging between half of that, about INR 70-INR 75 by this year. But it would not be the. I would just say, keep, we are working on it. We will not get this would be the average may be lower, but our exit of FY 2025 should be around INR 75.
Sir, you indicate INR 30-INR 40 for logistics and power around INR 20-INR 30. This takes you around INR 70-INR 80. How should we bridge this versus the number that we have indicated, say, up to INR 200?
So this is year one. And then I think we are doing something similar thing. It is on these. These are the three areas which remain and which we will be working in year two also.
Sure. That's helpful. So secondly, when we just go through the annual report, we find the cash tax rate for the company at 13%. This is against an effective tax rate of 33%. Sir, how should we understand this gap? So there is one of the schedules in the annual report which says exempt income and incentives, and there's a negative element of around INR 52 crores over there. So is there a better way to appreciate the difference in cash tax rate and effective tax rate?
We are still in the old regime. Our cash tax rate, you could say it's about 17%.
Okay. So still, if there's a gap, that would be on back of what?
I will get back to you on that, what you said here on the annual report.
Okay. Sure. Sir, I just 2 more questions. Sir, any update on Toshali mining lease, anything over there?
So I just said about in Toshali, there were elections, and then now there has been a change in the government. So we are going to now we need to have a dialogue with the new government. And I have already indicated that the arrangement which we have that over next one year, by September 25, we should have a proper long-term arrangement for the limestone. And preferably, we can get a lease, otherwise a long-term supply agreement on the basis of which we can plan investment in that region.
Sure. The last question is on paints. Can you quantify the revenue contribution? And secondly, the competitive intensity in the space of late has been pretty steep. What is our market strategy over here? Are we also reducing prices, increasing discounts to penetrate the market? How should we understand that?
See, one, on the paints, yes, the pricing is as per the competition. Today, as we gave an indication of a top line of about INR 300 crores in this fiscal, we are on track for that. In the first quarter, we have done about INR 57 crores of net turnover. And yes, on the EBITDA front, there was a loss of about INR 10 crores because mainly on account of the branding spend on the paint business.
Sure, sir. This is quite helpful. Thank you so much. I'll jump back to you. Thank you.
Thank you. Participants, you may press star and one to ask a question. The next question is from the line of Prateek Kumar from Jefferies. Please go ahead.
Yeah. Great, sir. As long as for the details. So my first question is on pricing in the north market has been a really weak versus historical trend what we have seen in the market. Can you discuss on the pricing how it is, I mean, how do we see it going forward? Also how it is looking for second quarter versus average of fourth quarter?
So actually, the prices are under pressure. And I would see that the second quarter, the pricing could be around would be lower than the first quarter. It's already, I mean, we are seeing some price drop about 1-1.5% already in this month vis-à-vis the first quarter price. So the prices, I mean, I don't see a possibility that this quarter we could we will definitely have a lower pricing as compared to the quarter one. However, we do expect that by September, the demand should really there should be a step up in demand. And hopefully, the prices should get corrected upwards in the month of October.
Sure. Okay. And is there like all players are sort of ramping up capacities or we know that UltraTech have had some capacity in north? Is it like how is the players positioning in the market in terms of market share?
Well, see, as far as we are concerned, see, we are also expanding and we have not lost market share in any of the regions. Maybe some in a particular we do monitor that on a month-to-month basis. So we are maintaining our market share. And it could be some producer may have a marginally higher and that too is amongst the top four, five players. We are really not monitoring. We compare ourselves with the three, four players in the region. And we see that our growth is in line with them or not.
Sure. Another question is on the profitability. Obviously, depending on pricing, but we had like close to INR 1,090-INR 1,100 unit EBITDA last year for standalone operations. Are we looking to outgrow that number in FY 2025?
It could depend on the pricing. See, the first half, we have the second quarter, as it looks now, should be lower than the Q1. And then how the prices take up. So definitely, when we could though our internal target, maybe if not on per ton basis, absolutely definitely on absolute numbers, we have an internal target to do better than last year.
Thank you, sir, this is my question.
Thank you. Participants, you may press star and one to ask a question. The next question is from the line of Pathanjali Srinivasan from Sundaram Mutual Fund. Please go ahead.
Hi, sir. May I add a bit?
Yeah. Yes.
Yes, sir. Sir, I just noticed one thing. RM plus fuel cost has kind of been flat for the last three quarters. So did we get some kind of an inventory benefit or something? Or could you explain why it has been flat?
So see, the RM and I mean, what has happened that looking through the volume numbers in this quarter are lower. But we have definitely built up some inventory of clinker looking to the maintenance of the mills which is likely to come up in this quarter. So it's a combination. I mean, yes, as we see as a benefit, the fuel pricing has been going down. So quarter on quarter over last three quarters when we are seeing, we are seeing definitely a drop in the main petcoke pricing. So that is the reason.
We have not got. Other raw materials, the price variation is more or less flat.
Okay. Okay, sir. And the price to fall is pretty steep in the last six months. But I don't see much of it getting translated into our numbers. So or it will kind of get it front-ended in the first quarter, which is like December.
Well, see, when you are looking at the raw material, it is also as we said in the last quarter, there were certain purchases of traded goods. That entry is also there. Otherwise, we are seeing major if you see raw material and fuel and the fuel cost has been going down.
Okay. Any guidance for the next few quarters for this?
So the fuel prices are softening. We are seeing that the petcoke pricing, which was around the consumption rate, which was around 160 at the plant in the last year, last quarter, that is January, March quarter, should be about $10 cheaper in this quarter. Going forward, also it should be about $10 cheaper.
Okay.
We will get some benefit in the subsequent quarters in terms of fuel cost.
Yeah, we should.
One more thing on realization. Can you give us some color on region-wise intensity on weakness in pricing or demand?
See, region-wise, I think we measured you have to say our measure volumes presently are in the north where there has been a dip in the central is more or less central and north are also about the same. Though central, the prices have been flat for last in the last quarter. But south is something which does fluctuate on and off quarter on quarter quite high. So south pricing is sometimes two quarters back, it was quite low, then it picked up. So the south pricing is something which fluctuates a lot. Otherwise, central and north are some prices. The fall is also when even a drop or an increase is within particular limits only.
Okay, sir. So large part of the fall should come in from north. Would that be a correct statement?
Yeah, yeah.
Okay. Okay. Just one last question, sir. Employee cost, will it stay at this level for us or was there any one-offs or anything of that sort?
No, it should remain the same at this level. There should not be any further increase in the employees' cost.
Okay. Thank you. Thank you.
Thank you. Participants, you may press star and one to ask a question. The next question is from the line of Mangesh Bhadang from Centrum Broking. Please go ahead.
Good afternoon, sir. Thank you for the opportunity. Sir, a couple of questions. Personally, on the paints business, given the competition that we are seeing with new players and things, would we revise our CAPEX guidance for this business anytime soon? Or you think that once we move out of UP and the rest of the CAPEX, we would need more CAPEX on the scene?
I didn't follow.
From the paints business, will we be revising our CAPEX guidance support? So would any more further CAPEX be required in this business as we move on?
Yeah, yeah. So as of now, we are sticking to our plans on the paints business. So what we had said that one, we are committed to about INR 600 crores of our investment in paints is limited to INR 600 crores. And with that, there is no change in that guidance. And in any case, we are not going to increase that on any count. And we are well on track on the plans which we had made on the paints business, both in terms of whatever annual investments and the growth of the paints business.
Okay. So on the power and sales side, what is the average of the current pricing in rupees per Kcal terms compared to one Q average?
Yeah. This quarter, the rupees per Kcal is INR 1.62. The previous quarter, it was INR 1.80.
With the petcoke coming down, how much it would be around INR 1.55?
Yeah, it will be about 155 or so in this quarter. In Q2, maybe between 150 to 155 in Q2.
Okay. And sir, with the large-scale CAPEX at Panna, as well as the Bihar grinding unit, we are having almost 6 million tons of grinding capacity additional by December 2025 and 3.3 million tons of clinker. So any plans to increase clinker capacity further or you think this clinker would be sufficient for you?
Oh, clinker is sufficient. See, today, with the present grinding capacity and the clinker ratio, we are still not operating line 1 and line 2 of Nimbahera. So we have sufficient clinker.
In Central, sir, and Bihar would be serviced by?
By Central India.
Central India, right? So there you would be requiring, right, at least?
Yeah, yeah. So see, ultimately, what you have to see, it goes on a when we make it is on a basis of 85%-90% capacity utilization average. So when we see when we talk about a capacity of 30 million tons or if you take Central India specifically, when we say 6 million tons, it means 3.3 million tons of clinker for a 5.4 million tons of grinding average at 90% capacity utilization. So 3.3 million tons of clinker is sufficient for 5.4 million tons of grinding.
Understood. And so finally, how much were the incentives for this quarter?
The incentives for this quarter is about INR 69 crores.
69, almost same as before. Thank you, sir. Thank you and all.
Thank you. Participants, you may press star and one to ask a question. The next question is from the line of Rajesh Kumar Ravi from HDFC Securities. Please go ahead.
Yeah, hi, sir. Can you hear me?
Yes.
Yeah.
Yeah, hi, sir. Good evening. My first question is, if you can explain the sequential price decline at least to be almost 5%, but the margin decline seems to be nominal. So is it that in grey segment, there is a higher amount of clinkers related to exports?
So yes. See, with the price decline, one, you are taking a market or average mixed price that is lower. When we talk about a blend of trades, non-trades, and different regions, so the price drop is not 5%. It is lower. Secondly, on an average, when it reflects on the cost, on the margin part, it definitely takes care of the reduced costs. So the fuel cost reduction and all is reflected in the margin part.
If you consider the clinker sales and the total sales volume in Q1.
Sorry to interrupt. Mr. Rajesh Kumar Ravi, you are sounding a bit muffled. If you are using the speakerphone, maybe you have to use the handset mode, please.
I'm on the handset only. Is it better now?
Yeah, yeah. It is better now.
Yeah, yeah. Okay. Okay. So do you know how much clinker sales go down? And secondly, the clinker.
Sir, clinker sale was around 24,000 tons. But in the previous quarter, because you are comparing the pricing drop previous quarter, so previous quarter, there was the one-off sale of around INR 30 crores, which was in the purchase of traded goods, and then sale was also there.
Okay.
You have to exclude that for the comparison purpose from the raw material cost and the sales.
Lastly, on the December topics, see, there was a.
Sorry, you are not clear, Rajesh.
Yeah. Voice is breaking. Basically, near this quarter, there is 138 negative stock adjustments. What was that pertaining to?
In December quarter?
Yeah, December 138.
138.
138.
December quarter, we'll check up on because we don't have all the December quarter data readily with us.
No, sir. That's all from my end. Thank you.
I'll get back to you separately.
Sure, sir. Yeah. That's all on my end. Thank you.
Thank you. Participants, you may press star and one to ask a question. The next question is from the line of Shravan Shah from Dolat Capital. Please go ahead.
Hi, sir. Congratulations on better profitability. Many questions answered, a couple of data points, and maybe a clarification. So first is, in terms of the volume growth guidance, last time we said 10%. So that remains the same?
Yeah. As of now, yes. See, the first quarter was an exceptional quarter with elections and intensive heat. We could not get those numbers, but we're still there with the annual numbers.
Okay. Okay. Great. Second, if you can share the rail-road mix and fuel mix for 2026?
The rail movement was 9%. With the fuel, the petcoke by the heat is around 68%.
Okay. So that means the first quarter and last.
Sorry to interrupt, Mr. Shah, your line is breaking up in between.
Hello?
Hello?
Yeah, sir. CAPEX, how much was in 1Q FY 2025? And last time you said INR 1,900 crores for FY 2025 and INR 1,800 crores for FY 2026 at consolidated level. So that number remains the same?
Yes, yes. That remains the same because our projects are on stream and going as per the schedule.
Okay. In 1Q FY 2025, how much we have spent on CAPEX?
We have spent around INR 125 crores on this project, the Panna extension. Plus, we have around INR 50 crores for the normal CAPEX.
Okay. Okay. Got it. Broadly, sir, if you look at the by FY 2030, we are looking at 20 MTPA to be added to reach a 45-50 MTPA. So roughly, if you look at INR 13,000 crores kind of a CAPEX, obviously, J.K. is likely to have a higher versus others. So just on a broader direction, in terms of the given the kind of a cash flow, don't you think the CAPEX on yearly average basis will be higher than the CFO and we can see an increase in absolute net debt, though it may remain in control in terms of the less than 2x net debt EBITDA?
So actually, while we have worked out our plan, we have ensured that our net debt to EBITDA is not increasing. So see, what you have to understand is that when we are taking up an expansion, we already have expanded. When we are taking up a next expansion, say at Jaisalmer, we have 5 million tons. So we are taking up expansion at a capacity of 30 million tons. So we will have profitability from higher volumes. So there will be incremental cash inflow, which is coming from the higher volumes. So after the particular capacity, I mean, I think after once you do it, your net debt to EBITDA is only going to improve upon.
Okay. Okay. In terms of given the price decline, I understand you have already mentioned that 1.5% further decline is there in the second quarter for gray and same. Do we think that there will be a decent price increase from the third quarter, and will it sustain in the fourth quarter itself? So broadly, still, our understanding says that we can see a 3%+ kind of on full year basis kind of a price decline. So just trying to understand, and given that, as you mentioned, that our other expenses now will again start increasing. So in terms of the profitability, trying to understand, given the pricing pressure and the cost, though we have a cost saving, but will don't it nullify the other expenses increase? Will nullify whatever the cost saving we will see?
See, again, price is something which is an expectation and which is a trend which everybody expects. And I think you all are also visiting the markets, and the same feel you are getting that the price increase should happen in Q3. On yes, Q2 will definitely be a tough quarter because, A, the prices have reduced. B, there would be incremental other expenses on account of branding. We are also going to take because we have to start branding prior to the festival season and the main market season. There is a maintenance cost, higher maintenance cost because all maintenance are also due in this quarter. So yes, Q2 maybe would be rather a tough quarter. But otherwise, I think we hope to recover everything from Q3 onwards.
Okay. Lastly, sir, if you can help me in terms of the paint EBITDA for full year because this quarter INR 10 crores EBITDA loss. Full year, last time we talked about INR 35-INR 40 crores EBITDA loss. Will it remain the same and the INR 500 crores revenue for FY 2026?
So FY 2020, see, one is FY 2025. We had given about a top line of about INR 300 crores. So that is we are on track for that. Yes, there would be a INR 40 crores net loss in FY 2025.
Okay. Okay. Okay. Thank you and all the best, sir.
Thank you. The next question is from the line of Piyush Pradhan from Citigroup. Please go ahead.
Yeah. Just a bookkeeping question, actually. So the INR 30 crores revenue that you mentioned, which was one-off in the last quarter, is this recorded in the grey cement revenue that you disclosed in the presentation or?
Yeah. Yes.
Okay. Okay. Sure. Thanks. Yeah. That was the only question.
Thank you. The next question is from the line of Jyoti Gupta from Nirmal Bang. Please go ahead.
Good evening, sir. Congratulations on a good set of numbers. Just a few clarifications. I saw that the volume decline was on a QoQ basis around 6%, and the price decline on a QoQ basis was 3%. And the total expenses per ton basis was 2%. And therefore, there was an improvement. The decline in the EBITDA was only at EBITDA per ton was only to the extent of 7%. Now, in the next quarter, since the cost that you just mentioned, your total expenses on a per ton basis is likely to increase by 6%, which will again be, and we will see some sort of a decline in price as well by 3%. So can I comfortably consider that EBITDA, however not bad based on the assumptions, we will see if not a marginal decline of maybe INR 972? Would that be a fair assumption?
It's a very fine and exact number. It's very difficult to say yes or no for that. But see, I still feel that the decline, it's just beginning of the quarter. And to have definitely our attempt would be to see that there is a minimum dip in the EBITDA. But we will have to really see how things go in the quarter.
No, because if I consider on a per ton basis, the branding expenses and maintenance, which is obviously it's part of the operations, and this is totally on the operational aspect, completely understandable. In fact, I would say these numbers are quite commendable. And even if on that basis, even if I take, I think last few four quarters away, I see JK Cement has performed quite well. So a bit of dip in the second quarter, given that this quarter is going to be a very is going to be a tough quarter, both in terms of again, we'll see a dip in volume by almost like on a Q1, Q basis of around 5%. Again, pricing a dip of 2%-3% because the major portions in the north, unless south gives a certain amount of volatility.
And then you have this entire maintenance and branding cost and all, if I consider all of them together, we should be fairly sitting at a very, very decent EBITDA per ton. One more question is the logistics cost, the reduction that we are having. Which part of the regions are we really consolidating in the sense where are we really seeing that improvement in terms of lead distances?
So we are working on lead distances mainly in Central India. See, one other reason what happens when you open up new markets to have your own. Now grinding units have started, capacity rushes come in. When you are opening up new markets, first you have to feed that market irrespective of the logistics cost. So you can't control the cost and then say, "I will only supply at a particular cost." So to open a market, you have to start. So as the market stabilizes and your production, so you are able to reduce the logistics, the lead distance and the logistics cost. Though in logistics cost, region-wise, the freight cost per ton per kilometer are different. They behave differently. While in the North, it is the cheapest per ton per kilometer. Central is higher and South is still the highest. So that is cost.
Could you give me that break? Could you just give me a ballpark figure in terms of the logistics per ton? Because what you're saying is fair, and obviously, the expense that we do in this quarter will actually, the likely benefit will start accruing in the third and the fourth quarter. So I think it's a value for money.
Whatever the logistics journey which we are doing, each quarter, we should get about INR 10 each quarter. What we are planning, INR 30, INR 40 in the year. We will get about INR 10 in each quarter, and that will flow so the exit becomes INR 30 or INR 40.
Okay. And sir, in terms of that you mentioned that central is cheaper, the lead distance, I mean, the cost per ton per kilometer, how much would that be in compared to north and south?
No, no. The north is cheapest.
Sorry, North is cheaper than?
Yeah. So North is one, Central is two, and number three, the cost is South.
Okay. Yeah. Understood. The other question is that with the Jaypee deal, now that's folded between Dalmia, and even the tolling agreement is also discontinued between Dalmia and Jaypee, and with the new entity, which would likely happen in maybe in the quarter, coming quarter, how do you see the competition intensifying for you for all the companies in central, in the central region?
See, the competition was in any case intensified because Jaypee, Dalmia was already has a plant. So they had a definite plant, and they were seeding the market and trying to build their positioning in the market. Now, we have to see who gets that Jaypee assets and how, whether it is a new player or it is an existing player, and what is his strategy. So I think, I mean, see, at least when it has gone to the NCLT, I don't think so it can take a decision in a quarter or so. This may drag along till at least this year end.
Okay. No, actually, my big stick says that even if Dalmia, even when Dalmia was in a tolling agreement, the exposure, let's say the amount of exposure that Dalmia should have gone, it really didn't go that well because of Jaypee dealership. So there were certain pushbacks for Dalmia.
Yeah, yeah.
For the new entity, it may not, it may be a different scenario.
Who's the new entrant and how it is? See, again, they will have to deal with the same set of dealers. See, again, a new entrant come, even if it's an established player, they have to, you have to increase that volume with your existing network. What will you do with the network of Jaypee? So all those questions come. We have seen UltraTech taking over earlier Jaypee assets. And they also took some time to rebuild their position in the various markets.
Yeah, yeah. Okay. That is my question. Thank you so much.
Thank you. This is the last reminder, participants. If you wish to join the question queue, please press star and one. We have our next question from the line of Sanjay Nandi from VT Capital. Please go ahead.
Yeah. Good evening, sir. Thank you for the opportunity. Sir, what would be your estimated clinker capacity on a 30-48 grinding scale?
Sorry, Sanjay, your voice is not clear.
Sir, what would be your clinker capacity on 30 million tons overall grinding capacity?
Clinker capacity would be above 18 million tons.
Above 18. Okay. And sir, just to mention that the next quarter will be having some significant part of the grinding cost as well as that shutdown cost and all those things.
Pardon, Sanjay, we could not understand.
Sanjay, you're sounding a lot muffled.
Now it's fine?
Yeah.
Yes. Better now?
Yeah. Sir, just to mention in the next quarter, we will be incurring some additional cost in terms of branding and also overhead cost for maintenance and shutdown things. So can you please quantify what kind of incremental total cost per ton we can anticipate in the next quarter from the exit of this quarter?
Yeah. Anything maybe INR 50-INR 70 a ton.
Got it. Got it, sir. Sir, thank you, sir. That's all my side, sir. We'll join in a few, sir. Wish you all the best.
Thank you. Ladies and gentlemen, we will take the last two questions. The next question is from the line of Siddharth Mehrotra from Kotak IE. Please go ahead.
Sir, just a couple of small questions. I see there's a subsidiary contributing to volumes in the gray business. Could you just tell me which subsidiary is this?
This is Toshali Cements, a nominal. So Toshali still has the operating plants, so it did contribute to some volume on the consolidated. It's about 16,000 tons. 30,000 tons, sorry.
Okay. Understood. Understood. I just noticed that the white cement volumes for the previous quarter have been sort of reduced marginally by around 4%-5%. So any color on that, sir?
Yeah. Actually, in the white business, we have done two changes. One is that we have excluded the self-consumption of the white cement for the putty. So we have excluded those volumes. And second, there are many complementary products of the wall putty, like putty adhesive, etc., which we were actually earlier not including in the putty volume. So we have included the entire putty family volume.
Okay. So can you tell me from which quarter you've made these changes?
We have given the previous figures also, restated the figures on the same basis.
Okay. So this has been done starting 1Q24, right?
Yeah, yeah. We have actually started from this quarter, but we have restated the figures of all the previous four quarters.
Okay. Understood. Got it. That is very helpful. Thank you, sir. Thank you. That's my question.
Thank you. The next question is from the line of Ajay Kumar from COV Capital Markets. Please go ahead. Mr. Ajay Kumar, your line is unmuted. Please proceed with your question. As there is no response from the line of current participant, we'll move on to our next question. Our next question is from the line of Amit Murarka. Sorry. Our next question is from the line of Navin Sahadeo from ICICI Securities. Please go ahead.
Yeah. Thank you for the follow-up opportunity. Sir, two quick questions. We are green power, I think we've done a very commendable job in a short span of time. From 19%, we've already exited 57%, target being 75% by FY 2030. So my question is, is there a possibility that we meet this green power target much sooner? And if so, and also, I mean, what is the cost saving that we get per unit in green power?
So see, per unit, the saving is around INR 3 per unit, approximately. So definitely on that, green Power is our priority. And when we gave, that was in 2020, when we gave the target for 75%, it was we were not very clear on whether we can reach that number earlier. Having said so, we now feel confident that we will be able to achieve that number at least maybe two years in advance, maybe by FY 2028, if not earlier.
Understood. Last question, sir, the Toshali volumes you said in the quarter were about 0.3 million tons. So.
No, no, no, no, no. 30,000 tons.
30,000 tons. Okay. 30,000 tons. My bad. So what is the full year volume that we can expect there?
So Navin, we are working on that plant. There's some accommodation and everything was required. So we would definitely like on a quarterly basis to achieve a number of about a lakh per quarter, which could be from maybe fourth quarter onwards.
Understood. Helpful, sir. Thank you so much.
Thank you. Ladies and gentlemen, due to time constraints, we would take that as a last question. I would now like to hand the conference over to Mr. Vaibhav Agarwal for closing comments.
Yeah. Thank you. On behalf of PhillipCapital (India) Private Limited, we'd like to thank the management of JK Cement for the call and many thanks to the participants for joining the call. Thank you very much, sir. Sagar will now conclude the call.
Thank you. Thank you. Thank you, Vaibhav. Thank you, everyone, for joining. If any questions are left, you can write to us, and we'll be happy to address the same. Thank you.
Thank you. On behalf of PhillipCapital (India) Private Limited, that concludes the conference call. Thank you for joining us. You may now disconnect your lines.