Ladies and gentlemen, good day and welcome to Shree Cement Limited Q2 FY 2026 earnings conference call. As a reminder, a`ll 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 a touch-tone phone. Before we begin, a brief. This conference call may contain certain forward-looking statements about the company which are based on the beliefs, opinions, and the expectations of the company as on the date of this call. The statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict. I now hand over the conference to Mr. Navin Sahadeo from ICICI Securities. Thank you, and over to you.
Thank you, Mark. Good evening everyone. On behalf of ICICI Securities, I welcome you all to the Q2 FY 2026 earnings call of Shree Cement Limited. From the management, we have with us Mr. Neeraj Akhoury, Managing Director, Mr. Ashok Bhandari, Senior Advisor, and Mr. Subhash Jajoo, the company's CFO. Without any further ado, I hand over the call to the management for opening comments. Over to you, sir.
Quarter 2 of FY 2026. As you all know, last quarter the Government of India took a significant decision of reducing the GST rate on cement from 28%- 18% along with various other commodities. We believe this was a very positive and a transformational step and augurs well for cement demand in the long term. The company has fully passed the benefit of GST rate rationalization to its customers. The company continued with its value over volume strategy. During the last quarter the total cement sales volume including that of Shree Cement East Private Limited were up by about 6.8% YoY on cement basis. With cement and clinker combined it was slightly lower. Total sales volume increased from 7.6 million tonnes in September 2024 to 7.9 million tonnes.
Last quarter realization per tonne increased from INR 4,451 per tonne to INR 4,840, mainly due to increase in share of premium products from 15% last year to 21% in September 2025 quarter. Total EBITDA accordingly increased by 46% from INR 582 crores to INR 851 crores. EBITDA per tonne, and this is a figure adjusted for INR 30 per tonne for one time impact, also increased sharply by 43% from INR 772- INR 1,105. On sequential basis, volumes were down by about 12% mainly due to heavy rains in North India in the monsoon season. Despite this, the company was able to maintain its realization. However, the total EBITDA at INR 851 crores was down by about 31%. EBITDA per tonne also decreased by 20% from INR 1,379 to INR 1,105. Very happy to say that the company's UAE operation registered its best ever quarterly performance.
Sales were up from 9.87 lakh tonnes to about 13.1 lakh tonnes, growth of about 34%. Sales revenue also registered growth of 50% YoY and EBITDA increased by 158% from AED 20.34 million to AED 52.53 million. The improved performance is a result of increased realization and improved operational efficiency. The expansion of the unit is progressing well. During last quarter the company commissioned clinkerization rate of 3.65 million tonnes at Jatara in Rajasthan. The cement mill of 3 million tonnes is also expected to be commissioned very shortly. The work on integrated project at Kodla, Karnataka of 3 million tonnes is in the final stage of completion and expected to be commissioned in this quarter. The company is continuously exploring various opportunities to grow better than the industry growth or slightly better than industry growth.
Recently the company has also commissioned a 20 MW solar power plant in Chitrakut in one of its subsidiaries. With this, the total green power capacity of the group now stands at 612 MW. The company has been rapidly expanding its RMC portfolio with 24 operational RMC brands at present. During the quarter, the company entered the East India market by setting up its RMC plant in Raipur, Chhattisgarh. The company also commissioned India's first RMC solar plant at its Jaipur facility. The unit now runs primarily on green, clean, renewable solar energy, reducing its carbon footprint and setting a new standard of eco-friendly construction in India. We are very proud to say that the share of green electricity in total electricity consumption stood at 63% in H1 FY 2026, which is the highest to my mind globally, but at least highest in the Indian cement industry.
All the company's manufacturing locations are also zero liquid discharge, treating, recycling, and reusing 100% of its waste generated from its operations. These efforts have enabled the company to improve its water positivity index to more than eight times. With good performance this year, the company expects to further improve its water positivity levels. India's economy continues to demonstrate resilience underpinned by strong consumption and sustained investment activity. High frequency indicators point to a pickup in real GDP growth in the second half of this year, supported by above normal monsoons. Steady employment conditions, benign inflation, and recent rationalization of GST rates are further expected to stimulate demand. These factors are likely to accelerate fiscal development and growth of the housing sector, which bodes well for the cement demand. With this, I have with me Mr. Ashok Bhandari, Mr. Subhash Jajoo, Mr. K.K. Jain, and Mr. S.S Khandelwal to take you through the Q and A session. Thank you very much, everybody.
Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and one on the Touchstone telephone. 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 first question is from the line of Amit Murarka from Axis Capital. Please go ahead.
Hi, good evening. Thanks for the opportunity. On cement realization, you mentioned it was INR 4,840 per tonne. This excludes other operating income if I'm not wrong. Could you give a similar number for Q1 as well?
4840 is excluding other operating income. The previous quarter I had explained that because of a glitch in our SAP system we could not come up with an NCR number. The NCR number this quarter onwards will always be disclosed to everybody. That glitch has been rectified, so we do not have a comparable Q1 number, but roughly there is a decline. There is a decline Q on Q increase, increment increase. You have already understood. Mr. Akhoury has already addressed it, and I will request Mr. Akhoury to address the second part of the question that was on.
I'm going to have your question. What we have said is that the realization per tonne this last quarter was INR 4,840, which has increased from INR 4,451 in the same quarter last year.
Sure. You also mentioned that you continue to prioritize realization over volume. Given that we are in the midst of a significant expansion program, what would be the outlook on the expanded capacities? Can we expect them to kind of? Have a slow and gradual ramp up? What would be the outlook on volumes essentially?
Amit, please understand that there are no entry barriers which anyone can create in the cement market. It is your strategy of value over volume which restricts you to your dispatches. However, I can assure you will be growing either in line or slightly better in line than the industry.
Sure. Just lastly, on the one-off, you mentioned that adjusted for one-off, what exactly was the one-off?
I am giving it to Mr. Khandelwal who is Company Secretary. He will explain you what it is.
For our Guntur unit, we had taken power connection from Andhra Pradesh Transmission Company, and we had to create a substation at our capex, which as per the agreement entered into with them, was to be transferred by gift deed back to the transmission company. This transaction took place this quarter. Therefore, this write-off.
Understood. Thanks. Thanks a lot. I'll come back in the queue.
Thank you. The next question is on the line of Rahul Gupta from Morgan Stanley. Please go ahead.
Yeah, hi. Thank you for taking my question. Just to delve a little deeper, is there any other one-off in other OpEx? I see there is a strong jump year on year on the other OpEx side. Any explanation on that would be great. Thank you.
I'm giving the line to Mr. K.K. Jain. He will explain you what it is.
Yeah. Good evening. As there's no other one-off in the result, the expenses, current quarter expense is slightly higher because of the r epair, maintenance cost, and other distress cost. Otherwise, there's no one-off in this.
Great. My second question is for Mr. Akhoury. Now that we are getting out of monsoon testing season, how should one expect demand from here on over the next couple of quarters? Are we seeing any green shoots from GST cut with respect to retail rural demand picking up? Thank you.
A little too early to project demand at this moment. As you know, we're just coming out of festival seasons as we speak. Actually, today is Chhath and happy Chhath everybody. This Chhath also means that there will be significant labor shortage across construction sites in most of our markets. Let us see how demand pans out. We expect, as everyone, that GST cut would boost demand in the long term. We have to wait and watch for its impact in the short to medium term. Clearly, GST cut was, as I said earlier, a transformational step. This augurs well with the cement industry demand projections.
I would like to add Mr. Gupta t hat t he effect of GST payable on finished houses hurts the low and middle income houses more. The vibrancy in low and middle income houses as well as Tier 1 and Tier 2 cities is expected to be far better than what it had been.
No, understood sir. My question pertain mainly from the perspective of how should we see the balance between demand and cement pricing over the next few months. That's what I was looking for.
I fully understand your question. As I said, we have to wait and watch to see how the demand pans out. Little too early to say. Given the fact that there has been a GST cut, one would argue that the demand boost should happen. It may take some more time before actually it is converted into purchase. That's where I'm saying in long term it is good for the industry, it is good for everyone. There has been GST cut. We have to wait and watch for immediately what will happen or in the short term what will happen. Prices. As I speak for Shree Cement, we have passed on the entire benefits to the consumers of the GST reduction. If you see our results, I think one thing you will notice is that our prices have remained almost similar to last year. Same quarter to the last quarter.
Not same this year, last quarter and about 20% growth. 19% odd growth from last year. From last year. Yeah. I think prices have been stable for us from this year, last quarter to the last quarter. Quarter quarter one to quarter two. Going forward it is not for me to forecast prices, it will be wrong. What I do see that if the demand grows little better than what we have seen in the first six months then prices should at least remain stable. If nothing else. Yeah.
Got it. Thank you so much, and all the best.
I'm so sorry, I must repeat myself. Year on year price growth was 9%, not 19%. I'm so sorry.
Thank you. The next question is from the line of Satyadeep Jain from Ambit Private Limited, please.
Hi, good evening. Thank you. Just wanted to ask on overall volume and the capacity that you're looking at, especially in North now that you have new volumes from the new line. Just wanted to see how are you going to look at this volume versus value growth. For the last few quarters the focus has been on premiumization. Should we expect similar focus on new capacity that you have? That first and maybe tied to this would be the second question that other players are also looking aggressively at North in general. Typically if I look at your capacity it seems incrementally. You're also looking at Northwood also expanding out of North and North is typically 50% of overall capacity.
As you look beyond the expansion and in the release you mentioned 80 million tonnes, how would you look at expansions across region with new capacities coming in North, would you look to maintain share and add more capacity? Just the thought process on incremental capacity beyond what you have in place.
To answer the first part. As I said in my opening remark, that on premium cement we grew from about 15% to about 21% this year. This has been possible with a very high focus on increasing our share in the premium product segment. Not only that, we have also worked on our general price levels to make sure that we are able to squeeze our brand equity in a better way. That has been the strategy which we have often defined as value over volume. This strategy is something that we would like to pursue in the coming years as well. On capacity, we have just commissioned, as I said, a new kiln in our north plant this quarter itself. Very soon you will see us also announcing the cement expansion in the same cement mill, commissioning at the same location, which will happen very shortly.
North remains our focus and north is something that will remain one of the areas where we will continue to evaluate all possible methods to grow in the coming years as well. Having said that, we are growing in other regions, be it east, be it south, and that will be on. Our focus on north will never go down is what I would assure everybody.
I have two more things to add. One is that if you look at the standalone and consolidated results, the EPS differential, which was always around INR 6.7, has gone up to INR 33 in favor of consolidated, which clearly points out that our UAE operations are doing far better. Mr. Akhoury had already pointed this out in his opening statement and we are expanding our capacity there as there has been very healthy price rise in the UAE market. Also, you will note that we generally have been very conservative in our dividend payout. This year we have given the highest interim payout, interim dividend of INR 80, and we expect to have an incremental dividend payout. There are various factors affecting this. Everybody had questioned us on the rationale of carrying such large cash reserves. Some Chief Investment Officers had asked for higher dividend payout and we have acceded to that.
Just one clarification question on both dividend and depreciation. Generally, depreciation has been very volatile.
This year we will be depreciating about 2,800 crore or so, which is based on the capitalization schedule. We have already charged about 1,100 crore in two quarters. The depreciation for next two quarters will be about 1,700 crore. That is all right because as everybody is expecting, we are that the prices should remain stable and the demand should return. There will be no hassle in availability of distributable profit in any case for the year.
Okay, thank you and wish you all this.
Thank you. The next question is from the line of Pennekin.
Excuse me one second. I stand corrected. The deposition for the year will be 2,450 crore, not 2,850 crore. I'm sorry.
Thank you. The next question is on the line of Penneken from HSBC. Please go ahead.
Thank you very much, sir. For my first question, among the three core markets of North, South, and East, how is pricing today on the ground versus the second quarter average? Is it lower or is it flat?
Are you talking about the last quarter?
No sir, today. Yes, today's prices versus the second quarter, the September quarter that went by.
No. As I said, the prices have been reduced, but that is largely because we have passed on the GST to the consumers, from 28%- 18%. The prices are lower than what they were in the pre-22nd September time.
Would the net realizations to the company broadly be unchanged today versus what you have seen in the second quarter?
No, I would say it will be slightly lower because of all the festivals and all the demand has not been very robust in October, and therefore we see some slippage of prices happening across India, not only in regions.
Got it. My second question is that again if you were to look at your t hree core markets, and over the next two quarters, do you see any one region demand outlook to be materially better than the other between North, South, and East?
When you talk about demand forecast, I always keep quiet because we have to be cautious in this statement. As we speak, we have seen demand growth almost similar across the country, almost similar except some states where it has been lower and some states have been higher. Not to compare region wise or maybe state wise, one can do some comparisons going forward. Also, I think this trend should continue. Only. I would expect North and West to be slightly better than rest of the country.
Okay sir. My last question is again if you look at your competitors' capacity expansion announcement, particularly in northern India, which is very large, and you highlighted that North is a core market for Shree. Should we expect Shree to defend its capacity share and hence at some point of time announce capacity expansion to maintain its current share?
This is a trick question, isn't it? This is a trick question. We have said that we will be growing marginally better than the industry. Now which region, what region, what kind of growth? How do you all forecast this? We have to be prepared. We are having sufficient physical resources to set up capacity in most of the areas where we operate, and we'll take a call as the demand scenario becomes more clear.
Understood. Thank you very much, sir.
Is the moderator there, please? Hello?
Yeah, can you hear me, sir?
Yeah, that's fine.
I think we've lost Mark. I can't hear him. I'll just dial him back one second.
The next question comes from the line o f Kushal Shah from PL Capital. Please go ahead.
Now, since the time we have undertaken the measures to improve the brand positioning and the premium sales on a portfolio level, how much would have the base realization improved on a per tonne basis? What would be the milestone here along with any timelines if it can h elp?
When we look for the numbers, as you know, the milestone remains that we have already reached about 20, 21% of premium sales. This is a level at which we would like to maintain in the coming quarters as well. If there are some improvements that will be welcome. The milestone was to reach about 18%. We have already reached 20, 20, 21% up from 15% and we will be focusing a lot that we are able to maintain this same level of premium share of our trade volumes in the coming quarters as well. Can you answer the first question?
Kushal here.
Yes sir.
Can you repeat the second part of the question?
First question?
No sir. One was the premium sales, which is very clearly visible, but also there have been steps to improve the brand positioning as well as the base brand positioning. All I'm trying to understand is, since the time you have taken these measures, how much would the base realization have moved up? Let's say keeping other things aside, I mean status quo, how much would have the base realization impact?
Kunal, that is the point I'm trying to make. Mr. Akhoury in his opening statement had said we have improved 9% year- on- year. It is unfortunate that I could not give you NCR number for Q1, but Q2 or H2, sorry, H1 vis-à-vis last year, H1 9% incremental price is there, which is a mix of various things. And i t is. Y ou see p lease understand, my dear friend, that if we are saying that we will focus and we have reached 21% of premium sales, the price trajectory should be upwards or stable. However, demand and pricing in commodity is very difficult for any company to address, isn't it?
Understood. No, that helps. Secondly, sir, on the cost savings, especially on the logistics front, where exactly are we in the journey? You know, because we were planning to aggressively increase the rail share. Could you just reiterate our positioning? Here and the quantum of.
Just to reiterate on our last question once more before I come to the second question. As I said, we have increased by 9.8%. I believe some of the players who have announced the realization year-on-year, if you see the gap of our performance, you can get a sense of how much we have improved. That is part number one on the rail. Very focused work is going on. We have, as you know, already commissioned our Purulia railway siding in our Purulia unit. We are doing siding in Kodla for which the project work land acquisition has been done and now the construction process has started. Similarly, for ITA we have completed line deposition and project work has started. A lot of focus has been there to improve our rail connectivity across India, and you'll see that very soon some of them will be commissioned.
This is very helpful sir, just to extend it, like in FY 2025, what would be the real mix exactly, what are we going towards, and what would be the savings if that? That would be very helpful.
Presently we are at about 11%. Yeah. Of rail share in our total outbound logistics here, we think we should reach about 20% in the coming time. If I see at savings, typically on the PTPK railway, rail is about 1.8, 1.9 versus road at about 2.3, 2.5. If I look at the industry across, especially in the North region, one would expect that at least INR 100, INR 100 per tonne savings should come from our increased focus on railway operations.
Got it. Sir, if I could just squeeze in one more, I think there was a lot of efforts towards the AFR shipments. INR 100 on the logistics front, and anything on the AFR front because I believe that share is also on the lower side, right? I mean, there's a lot of scope over there.
As I said, a lot of project work is happening across on the AFR side as well. We are now at about 2.3% up from 1.5% same quarter last year. This is on AFR you said? Yeah. More and more facilities are getting created as they roll out in the coming years. You will see we will also go up on RAFR consumption.
Got it. Sir, if I just squeeze one more, just from a capital allocation perspective, what should be the capex number for. 2026, 2027, 2028?
2026-2027, roughly you estimate INR 3,000 crore and 2027-2028. We have not. We have a broad capex in mind, but it should be in line with this much only. It may spill slightly to 2028-2029 because we are rethinking our commissioning strategy. I can assure you that we will maintain our spirit of growing marginally higher than the industry growth rate.
Yeah, yeah.
Just to clarify, 80 million tonnes could get spilled over to 2029.
I cannot see. Please understand it's not that we are devoid of any physical resource. It is basically how the capacity utilization of the company gets ramped up and how the demand gets ramped up. It is dependent on that. We are taking a stand that if needs be, 80 can shift to 82 by 2028. May shift to 80 by 2029. As the time passes, we will keep on updating you.
Understood. This is extremely helpful, sir. Thank you so much and all the best.
Thank you. The next question is from the line of Shravan Shah from Dolat Capital.
Hi sir, just to check. Now currently we have a 62.8 million ton and 6 million ton. Both Jatara and Kodla will be added in this quarter. We will be 68.8 and from there by FY 2027 and 2028. Will there be any capacity addition because 3 million ton Jatara was postponed.
Now wait a minute, wait a minute, wait a minute. You are asking too many questions. Let us address one at a time. 67 million, 66.8 or 67 million March 2026 is given. We have given you a CapEx guidance of about 3,000 crore, so we should be about 72 million- 75 million March 2027. I have already told you that. Let us see how the demand and how capacity utilization moves to see whether we need to become 80 by 2028 or 2029. You have seen our balance sheet. You understand we have all physical and financial resources to do this capex. That market also has to, so the market conditions are to be recognized in planning exact dates. So. Yeah, go ahead.
Got it, sir. This 2028 or 2029 when we say, is this a calendar year or FY 2028 or FY 2029?
We are not talking calendar year at all. We talk FY.
Okay, got it. Sir, I need a couple of data points. Even last quarter we did not have a call. If you can share the data points for Q1 and Q2, starting with.
One second. One second. Let Mr. Subhash Jajoo take you through all the numbers because he is the CF O the company.
Yeah.
You can ask all your questions and pointed questions to him.
Yeah. Sir, trade, sir. Blended cement, sir, for Q1 and Q2.
Yeah. For trade sale, it was 70% in September 25th, and in June it was around 71%. Landed cement sale was 68% in September and 70% in June.
Okay. Lead distance in Q2 and Q1?
In Q2, it is 441 km. In Q1, it was 451 km.
Okay, got it. And for Q2 and Q1.
For Q2 it is 1.66 and Q1 it is 1.59.
1.59. Okay. It has decently gone up from even from March level. Given the current petcoke prices and the coal prices, do we see any further increase in this KK cost?
No. As per our inventory pipeline, I think it should be around similar levels, maybe slightly lower than this.
Okay. In terms of the fuel mix, broadly the petcoke and coal would be a 90% to 95%.
This quarter it is like around 66%. It is pet coke and balance is coal and other alternate material.
Okay, got it.
Sorry to interrupt.
Yeah, no issues. Thank you.
Ladies and gentlemen, to ensure the management can address questions from all participants, please limit your inquiries to two per person. If you have a follow up, kindly rejoin the queue. The next question is from the line of Raashi Chopra from Citi. Please go ahead.
Thank you. My first question is, Mr. Akhoury, you made a comment saying that, you know, in addition to premiumization, you're also focusing on pricing to be able to extract the best value for your brand. Could you just elaborate on that please?
Rashi, let us understand. Only 21% is premium. Now in our sales mix, Mr. Akhoury has clearly said only 21%. If you look at the incremental price rises, it must be incremental plus general category also. You get my point. Overall, there is a price buoyancy. How it will pan out is completely dependent on market conditions. The delta between peer groups, we are certainly trying to converge on the top line rather than price.
Right. How are you trying to do that?
Mr. Akhoury will answer that, please.
In a sense, you know this market, as you know the industry market, there are for same kind of product, there is a price ladder which is not less than INR 15- INR 20 or even higher. This is what we call the price gap between brand A and brand B. Through our pricing actions as well as distribution actions, we are trying to reduce this gap. That is one effort that has worked for us in the last six months. Odd. That is where we said that we will focus on value over volume. In addition to that, we have also focused on premium products, which are higher price than the base product. Their positioning in the market is on the higher side, and these two combined, for base brands as well as for premium, there has been a focus of reducing the gap with some of the peer group companies. That has helped us to record 9% price growth last quarter versus, I am not so sure. I have seen the figures of others, but whatever figures the others have, if you could look at it, then I think Shree's performance on price growth will be slightly better than what industry has seen.
Understood, thank you. That's helpful. On the volume side for the first half, now your volumes are down about 2% on a year-on-year basis, total volume cement plus clinker. What is your projection for the year for yourself?
We should do about 37 million- 38 million tonnes this year.
Yeah. Okay. On the power side, green power, I would imagine that in this quarter your green power proportion has gone down to about 60% or so.
Yes.
I mean for the first half.
63. Yes.
Raashi you are forgetting renewable also consists of solar, and this was monsoon period.
60 is a correct number, right?
Yeah, 60 for the quarter is the correct number.
Okay, got it. Okay, that's it for me. Thank you.
Hello. Thank you. The next question is from the line of Prateek Kumar from Jefferies. Please go ahead.
Yeah, my first question is on your UAE plans. Can you elaborate on the expansion plans there? Overall outlook, as you said, is like very positive.
UAE demand has been quite robust, quite healthy in the last one year, if not a little more than that. Our assets in UAE are very well positioned to serve all parts of the country, including the main consumer centers of Dubai and Ras Al Khaimah. Our numbers have shown that we are doing very well, and hence we have decided to put a new mill there of 3 million tonne capacity. We have excess clinkers in UAE. We used to sell clinker earlier. We now believe since the cement demand is very robust, we can convert that clinker into cement and sell it in the domestic market. In addition, in UAE we also produce some special cement products like oil well cement.
Oil well cement from our facilities goes across the world, not only in the Middle East but also in some markets of Europe and some markets of U.S. North America. We are also doing debottlenecking of our kiln there. That will give us about 500,000 million tonne of additional production of clinker. Overall, we are very positive on the UAE market as well as the Middle East market, where we sell not only the base product but also the special products like slag and oil well cement. Hence, this capacity expansion program has been announced.
All right, what is the full quantum of CapEx? If you're looking at it, it probably is part of consolidated operations and not standalone.
It's AED 110 million or approximately of CapEx in UAE.
By the way, I must point out that it is fully funded by the UAE by cash available at the UAE.
Yeah, it is fully funded by cash available. Cash available at UAE.
The other question is like this 40 EBITDA per tonne of 1100. With very minimal visibility on price improvement in the third quarter, are we looking at our EBITDA profile of 1300-1400 which we used to like sort of earlier?
Prateek, this question you ask me every quarter and every quarter I humbly suggest that it is impossible for the hands of any commodity supplier or manufacturer to predict the price. Price is not in our control, my dear friend. Market forces decide the price. When will my EBITDA go up at INR 1,300 or INR 1,400? I am not in a position to enter. Prateek, please appreciate that any incremental price rise is a straight flow to my bottom line. Now, how much incremental price rise will come, when it will come, how much volume will come? These are not. These are affected by various macro factors. What is you are looking at INR 1,300. Why not INR 1,800? Let us understand. Let us be realistic. We have said we have done 1,100. Mr. Akhoury has clearly said that he does not expect. He expects some demand vibrancy. He expects stable to a stable pricing scenario. At first we will do 1,100. At best we can do 1,200. I don't know that. I am not saying everything. Maybe we can do 1,300 as well. You will have to have patience, my dear friend. People have been claiming all kinds of EBITDA, never delivered. We don't promise anything. We deliver and then we say.
Certainly, sir. Thank you. This is my question.
Thank you. The next question is from the line of Satyadeep Jain from Ambit Private Limited. Please go ahead.
Hi. Thank you. Just a couple of questions. First on the dividend. We appreciate the thought process that there is fair cash and some of it can be given out as dividend. If you look at dividend, even after dividend, dividend looks like 0.4% odd.
Go ahead, please.
What is the need for having such a lot of dry powder still on the balance sheet given the CapEx and all you're looking at for the next two, three years? Why not look at one-time dividend, special dividend? Just the thought process on keeping so.
Much spare cash, my dear friend. On our strategy of keeping spare cash, please talk within your firm with Nitin Basin. We have explained to him many a times why this cash is needed. The other point that why not one time will address it.
Second would be on the growth that you're outlining. You're talking about growing in line with the industry and that I'm guessing or maybe slightly higher than industry that maybe looks at volume growth. What about capacity utilization? Is there any capacity utilization number that we typically look at?
Is there any demand number? Can you tell me what is your expectation of demand growth and what is the basis of that expectation? [Foreign language] We will not look shy upon. We will be doing either equal or better. Hopefully we maintain.
Okay, thank you, sir.
Thank you. The next question is from the line of Amit Murarka from Axis Capital. Please go ahead.
Hi, thanks for the opportunity again. Just in some data questions actually, what would have been other operating income in the quarter? If you can share that.
Other operating income, you have that here. Hello Amit, you can send us a mail and then we'll reply on that because right now that data is not available.
Sure. You mentioned cement growth of 6.8%. What could be with clinker if you can get the total volume basically for the quarter?
Yeah, I think you missed the first part of the opening remark. Where we have given the volume, it is 7.9. The total growth will be around 4.8%, 4.6%, 4.7%, around 5%.
5% is simple cement and clinker, both 6.8% of cement for cement only.
Got it. That's all. Thank you.
Thank you. The next question is from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Hi sir. Good evening. My first question, you mentioned on the premiumization benefit which you have approved, which I can read in the numbers given that Q2 you have delivered around 9% NHR growth while most of the other companies have delivered 5%- 7%. I believe for H1 also you mentioned 9% volume realization growth. Hello. Am I audible?
Can you ask the question again, please?
You mentioned the cement realization that you like to like. Cement realization growth is 9% for Q2. Right. Year on year.
4,854 over 4,409.
Comes to around 8.7% or 9%.
Yeah.
For H1 also, the growth is similar, around 9%?
For H1 also. Yeah, it's similar at about 9%. Yes.
Okay. If I work backward, our cement realization on a Q-on-Q basis would have come down by around 11.5%.
It is flat, actually.
It is flat. Okay. It is flattish. Now on the UAE business you gave the volume numbers for Q2. Could you share the Q1 number also and the year-on-year number for UAE this year Q1 and last year, and also request, can we, you know, now that UAE is also delivering performance in line with the domestic operations, 20% plus margins, can we look at the company at a console level rather than, you know, looking at the two units separately.
Indeed you should. That is what the idea is. That is why I pointedly mentioned the cashing PS number. Maybe a consolidated result for valuation may be more authentic.
Exactly.
Than doing standalones.
What was the volume number you.
You take the numbers from Mr. Akhoury is prepared with the actual volume numbers.
Last year same quarter UAE was at 9.87 lakh tonnes. This year it has been 1.13 lakh tonnes, 13.19 lakh tonnes.
That is Q2, right?
That is Q2, September 2025 was 10.09.
Sorry.
June 25 was 10.09.
Okay.
September 2024 was 9.87 and September 2025 is 13.19.
Okay. June 2024 also. Would you have handy?
No, that I don't have. I'm so sorry.
You can send.
We'll get into that. Great. Yeah. That's all for my answer. Thank you.
Thank you. The next question is from the line of Sumangal from Kotak Securities. Please go ahead.
Good evening. First question on the volumes. If you look at H1 there's a decline of 2%. I just want to understand either industry-wide or in our core markets what would have been the market industry growth, and just trying to understand what is the market share loss which we've seen.
I would not have the H1 number for industry, but quarter two, the best estimates coming is around 3%- 5% cement demand growth. Yeah. Versus that 3%- 5%, we have done slightly better at 6.8% on cement sales. The first quarter was when we were very firmly trying to establish our value positioning in the market, and therefore you saw lower than expected growth. The second last quarter, I believe, and the best information that I have of market growth, versus 3.5% of industry growth, we are slightly ahead on our performance.
Let me just also make one point very clear to you on our value proposition. Consol numbers of 914 have been reported vis-à-vis our standalone number of 1,105. If you compare it with the standalone, it is INR 966 to INR 1,105. The delta which was there in Q1 of INR 137 per tonne in EBITDA has been slightly bettered, I think by INR 2 or something.
Understood. Sir, should we understand it this way that if you look at even FY 2025, our volumes are flattish, one key also we would have, I mean, appears that we would have lost market share and from 2Q now we are maintaining and gaining. Now since our value proposition is now established and even for future when a lot of capacities are coming up and you guided that we will be maintaining share and even gaining to some extent, there is a subtle change in strategy. Is this the right way to kind of look at?
Wait a minute, wait a minute, wait a minute. We have not said that we will not remain focused on value. We expect additional demand to come in because of all the fiscal measures announced by the Government of India, and that should keep us in line or better than the industry depending on the geographical reach, number one. Number two, you also please appreciate that the value over volume proposition, you do a very simple calculation. You do the capacity utilization of, say, all cement plants and plot EBITDA per tonne of all cement plants. You will see an inverse correlation. So have a look at that.
Okay.
There is no change in the strategy. This is what we would like to keep reinforcing, so it is value over volume. Having said that, and you have seen that in the results when we say 9% realization growth over last year, you should compare it with the industry numbers, and I'm sure you will find that we have not done badly. At the same time, while delivering 9% realization growth, we have also delivered 6.8% volume growth. It only means that the strategy has started working. How does the future pan out is difficult to say at this point of time. That is how I would say.
Very clear. Some Ready-Mix Concrete business looks like there's not a focus here. If you can just share what is the outlook in next three, four years? What sort of targets are we looking at in terms of number of plants, maybe revenue contribution, etc.
RMC is a new business for us. We've just started a year back. Already about 24 plants are operational. I think this is one of the fastest ramp up of RMC business in this industry. We had an initial goal of going up to 40 plants by FY 2028 and that continues even today. We are trying to put up more plants. 2026. I'm so sorry. Not 2028 .
Having said that, it is also a time for us to better understand the profit levers, the revenue levers for this business and make it more prepared so that we can have a playbook of RMC business and we can therefore thereafter keep putting new plants at a better performance level. That is how I would see it. Understood.
Thank you, ladies and gentlemen. We will take that as the last question for the day. I now hand over the conference to the management for the closing comments.
Thank you everybody. Thank you for participating and thank you for supporting Shree. As I said, we will continue to remain focused on delivering a better performance. Our strategy is working, and we hope we should continue to give you better than industry performance at least on EBITDA in the coming years as well. This is our focus, and this is how we would like to perform. Thank you very much again everybody. Happy Diwali.
Thank you on behalf of ICICI Securities. That concludes this conference. Thank you for joining us. You may now disconnect your lines. Thank you.