Shree Cement (NSE:SHREECEM) Q1 2027 Earnings Call

0:00 Ladies and gentlemen, good day, and welcome to SHREE CEMENT LIMITED Q one FY twenty seven Earnings Conference Call hosted by ICICI Securities 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 this conference call, please signal an operator by pressing star, then 0 on your touch tone phone. Please note that this conference is being recorded. I now hand the conference over to mister Navin Saeedo from ICICI Securities Limited. Thank you, and over to you, sir. Thank you, Palak.

0:46 Good evening, everyone. On behalf of ICICI Securities, I welcome you all to the q one FY twenty seven earnings call of SHREE CEMENT. From the management, we have with us Mr. Ashok Bhandari Mr. Subhaj Jaju Mr. S. K. Jain. So without any further ado, I hand over the floor to Mr. Ashok Bhandari for his opening comments. Over to you, sir. Thank you, Navin. Good evening, everybody. Before we start the actual Q and A, I just want to make two specific points. Point number one is that, I've been pointing out to you guys that we should, this time has probably come when we should look at consolidated numbers instead of stand alone.

1:39 This quarter, almost 10% of the turnover has been contributed by my overseas subsidiaries and a 100% subsidiary in India. And the standalone number is about 88, 89% only. All these are CEMENT businesses, so we would like to request everybody to start looking at the consolidated results and not standalone results. Going forward, I sincerely believe that due to doubling of capacity at and UAE, which should be upstream by third quarter twenty six, twenty seven and increasing penetration into Eastern market.

2:28 The Sea Cement East performance should also improve. And going forward, in not too distant future, probably the standalone tree cement should constitute about 75 to 80% of total revenue and the other constituents will have 20 to 25% of revenue. So, to have a more transparent and clearer picture on how we are bearing in our gray cement business, it is better to look at consolidated numbers. This is point number one. The second point is that you have to appreciate, what kind of hardships we have to face because of the Middle East war. Three things happened.

3:14 Number one, the pet coke which were contracted for could not reach us, which had to make a shift the fuel from pet coke to coal. The percentage of pet coke reduced from 54 to nine whereas coal increased to 74 from 26. Now, the other point is that the contracted Gypsum quantity out of Oman could not reach us. Now, had a similar effect. They both adversely affected the cost of production of the company. One is gypsum was not available, we had to procure it more expensive gypsum of lower quantity within domestically.

4:10 If pet coke was not available, then we had to go for lower quality coal, which was available at a more expensive cost. Because of these two factors, two things happen. The raw material per se went up because the gypsum prices went up. Number two, because of lower quality of coal, our conversion factor means clinker to cement ratio changed, which increased the components of clinker in my cement and this is because high ash content coal when physically and chemically reacts with the liquefied calcium oxide, the absorption of ash increases in clinker.

4:56 If the clinker has more in situ ash, then my, I I get limited on my conversion factor and I have to reduce the quantum of pozzolonic or other cementitious material. If so, both resulted into higher cost of production and also affected my trade sales. Because if I'm making, if my conversion factor is going low, that means I'm producing more OPC. And the biggest market for OPC is non trade sale. So, on one hand, I had a cost push, on other hand, I had a more quantity to sell in non trade or non trade section, both resulted into slightly lower realization and relatively higher cost of production.

5:56 However, let me tell you, this in no way indicates what we intend to do in future. We intend to go back to our old philosophy of keep on increasing the conversion factor, optimizing the cost and keep on pushing trade sales, number one. Number two, which you have to also bear in mind that the cement which will be produced and the pertinent and the the embedded fuel cost has almost peaked out in our case. The lower cost contracted pit coke had not reached, which has started reaching now.

6:45 It was substituted by higher cost. We are at about instead of guiding 1.82 per kilocalorie cost, we almost touched 1.95. And I feel, barring anything untoward happening in the Gulf War, the fuel price have almost peaked out. The PVC prices have started coming down. My packing cost has already started reducing. So, though I had in last conference said that my cost will peak out in Q2, because of these factors, I think we have almost peaked out in Q1.

7:31 And if anything undo or doesn't happen in Middle East, this cost should more or less stabilize or rather go down because raw material cost should also come down. Having said this, now I'm opening the floor for question and answer. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question, may please press star and one on your touch tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants are requested to use handset while asking a question. Ladies and gentlemen, please wait for a moment while the question queue assembles.

8:23 The first question is from the line of Rajesh Ravi from HDFC Securities. Please proceed with your question. Yeah. Hi, sir. Good evening. Am I audible? Yeah. You are very far. Yes, sir. Great, sir. Yeah. Thanks for opening your presentation quite enlightening. Sir, first on the housekeeping numbers, what was the fuel cost for q one blended and trade mix? And the fuel mix you already mentioned? And what was the factor and also cement realization? I asked the team, sir, that's usually. Pinucharovat is there in my opening statement. I have said that my fuel cost for the quarter was 1.95 per kilocalorie.

9:13 I have said that I had to push more of non trade sale because the conversion factor had come down. Number three, you have asked about realization, I will give it to Mr. Who will give you exact realization number of trade and non trade. And number four, you have said that what is the mix of trade and non trade, that also Mr. Can give you. Oh yes sir, I think that sir. Yeah, the difference I have done is 4,919 per MT against 20 Indian rupee. Yeah. In Indian rupee, $44,919 against the 4,854 last June 25. This is Indian operation only. Is operation. 884. Yes.

9:59 Okay. And what was the clinker factor, sir? The clinker is 1.5. So for current quarter, against the 1.58 of the corresponding quarter. Okay. And trade mix and blended cement? It's a 52% is trade against 71 in June 25 and fifty percent blend ratio against the 70% of June 25. Understood. Understood. That's okay. Sir, you mentioned that, no, the fuel mix were expensive when you move to thermal coal or you purchased to India. So when you normalize this, this is your procurement, which is now coming into Q2.

10:44 How should the fuel blended fuel cost look for Q2, assuming if the things remain steady where they Madhari here. Ravi, had told you that our fuel cost has almost peaked out, barring nothing untoward happening in Middle East. Correct. We are looking at 1.95 today. It may hardly go up by two, three paisa, but that doesn't materially change the cost equation. Okay. Understood. So this is with the, which you have, which was to be received from It started our IRR which was contracted for. And, well, of course, if anything drastic happens in Middle East, it may or the equation may change completely.

11:34 As of today, we don't feel that there will be material increase. The one point, Rajesh, you have to understand is, in spite of all these challenges, quarter and quarter, year on year, volume growth is standing at staggering Phenomenal. Percent plus. Perfect. Right. So this was my next question. Yeah. Kind of. Yes. Yes. Yes. And that was the next question, sir. Is the outlook on the volume now? And and no, no. It's not the focus of volume or anything. We had never lost we are never volume focused. We are profit focused. We have never changed our focus. You will never find us changing our focus.

12:21 It's because of 17% growth already, think, please understand, you have to appreciate this very clearly. I had guided in March on call that we should do 40,000,000 tons in 2627. We have already done from Indian operation about 10.4, 10.5 in Q1. We are on track to do nine to 9.4 in Q2. So, by HY twenty six, twenty seven, HY one, six, twenty seven, we should be at about 19.5 to 20,000,000 ton. You also have to remember that if you look at the general sales mix of the industry, 48% of the quantity gets sold in first six months and 52% in next six months.

13:15 If we can, if we can do 20,000,000 term, then you can do your own calculation and see that we can go up from 40 to maybe 40.5 or 41. But I'm not guiding that. I'm still sticking to my guidance of 40,000,000 tons and I'm saying that as on date, the things as they stand today, we should reach 40,000,000 tons and we should deliver healthier profit Q2 onwards. Great, sir. And sir, just continuing on this realization, which you mentioned, INR4919 million for June quarter and which was INR 4,752. So despite selling higher volumes in non trade, you were able to see a decent improvement in realization by around INR 160.

14:06 Is this understanding correct? Yes, you are understanding. You keep the numbers straight. You have to understand is that this is again you are just looking at stand alone. If you look at the control, which you, I request all analysts to please pay heed to this advice. Henceforth, we will be talking of console volumes, console EBITDA. We will not be talking about which constitute what, where it has come from. Gray Cement business, Total, SHREE CEMENT, including its subsidiaries will be delivering a number, which should be accepted, which should be, which should be and in EBITDA, total EBITDA.

14:54 That's it. If you look at the So, we have the control volumes? One second. You look at the consolidated, the volume stands at 114.5 for the quarter. Okay. The operational EBITDA without other income, Repeat without other income stands at $12.72. The corresponding numbers June 25, the volume was 99.6 console. Remember, these are console Operational EBITDA was $13.33 and operational EBITDA per ton was $13.39.

15:44 Whereas this year, this quarter, we have done one one one one, four times one. So, though we have taken the beating on EBITDA per ton, but I explained you that this was majorly because of our shift from pet coke to coal, which we were forced to and lack of availability of Omani gypsum, which had effect on raw material cost, conversion factor and conversion factor change has compounded the effect on raw material cost, our total costing and non trade sale, increase in non trade sale has had some depressing effect on my premium sales. Great, sir. Could you also share March 26 console volume, sir?

16:36 26 console? 26 console volume March 26. March 26 console was 119.4. And for full year was around One second. You please hear me. There is a dip from 119 to... 119.4 to 114.5 on consolidated, isn't it? Now, difference, majorly because of practically no sales in May and April and May in UAE because of war. And please understand that UAE, are doubling. We are going to charge 7,000,000 tons by q three, FY twenty six, twenty seven.

17:22 So this number will keep on increasing, my friend. That is what I'm requesting everybody to start looking SHREE from consolidated angle and not from standalone angle. Yes. This is great. This will make it more comparable. And really enhances the overall profitability in the. My friend. Great, sir. I'll come back in queue. Yeah. Thank you, sir. The next question is from the line of Amit Murarka from Axis Capital. Please proceed with your question. Yeah. Hi. Good evening, and thanks for the opportunity. Just a question on the non trade. So while you said that because of the issues in availability of gypsum and pet coke, was an impact on fuel cost.

18:21 Mr. Let me tell you one thing, please. Gypsum has no role to play in shift from trade to non trade. It is only that weaker quality of coal by FX, by clinical quality, which affects my conversion pattern and that affects my trading. My non trade sale had to increase because my conversion factor was lower and I had to go into the non trade segment. Please be very clear. Gypsum has more role to play in trade or non trade. Gypsum has a role to play in affecting my long field cost. Sure. And could you repeat that again? That's what my confusion was, like, why you had to shift to non trade because of this.

19:10 So you've mentioned that the clinker is something like that. No, no, I could not get you. What have you said? One second. No, could you please repeat, I mean, why you have shift to non trade because of the West Asia crisis? I explained you, my friend, Petco has very low ash. It has hardly 1% ash. So, coal or fuel, solid fuel chemically and physically reacts with the limestone throughput. If I have very low quantity of ash in my fuel, the ash absorption in clinker will also be very low. If I am using a 20% ash content coal, the ash absorption in clinker increases.

19:59 That means, in in situ or within the molecule of clinker, because of low quality coal, more ash is there. So, I cannot dilute the clinker by adding more and more pozzolanic material. I have to use less and less pozzolanic material. That means, Zipsum is to be consumed. Now, Zinsom itself became expensive, green car is two third of the cost of production. If that component has come down from 1.58 to 1.50, please understand it will have its own cascading effect. And that is why and I, if I am having a lower conversion factor, I will have to look at OPC, sorry, primarily OPC buyers.

20:54 If I am looking at OPC buyers, then market is the only segment where I can sell. But this is all one quarter delta. This is all the effect in this quarter. I don't think this is a very unique situation which we have faced. I don't think this will repeat in future, provided nothing explodes in Middle East. Sure, sure. So on a more sustainable basis, what is the trade, non trade mix that you would like to have then? I would like to go back to 7030% non trade here. If figures were, figures would write. Sure. All of the history of this company proves that we have been champions in trading.

21:46 It is only because of this typical problem of low quality coal to be consumed because of at least that I have to reduce my conversion factor, which subject my growth in trade sales and I have to necessarily address non trade market. Okay. Okay. Got it. And just also RMC performance, if you could share in the quarter. We have 36 operational plans. We had 19 at the beginning of the year. We have added eight plants in this quarter. We intend to add another 10 plants in next quarter. But please, RMC as on date is almost a profit neutral game.

22:39 As we learn the business, as we start pushing more volumes, the operating efficiency itself should bring the EBITDA of this business to at about 5% levels. But as of yet, RFC is not meaningfully contributing to that bottom Correct. Got it. Got it. And I'll stop. So that's it. I'll come back. You, sir. The next question is from the line of from DAM Capital. Please proceed with your question. Yeah. Hi, sir. So just first question on this 17 odd percent volume growth. Could you please Kunal, can Kunal, sir, can you please please mute mute your your handset? Handset?

23:32 Yes, sir. Please proceed. Yes. This is the first question on the India operations and the 17% volume growth. Could you just help with how would this growth be looking across our regions, basically, primarily between Northeast and South? And also some understanding on the regional utilization as well during 1Q? I am giving the line to Mr. He has all the numbers. He'll give you. Hi, good afternoon First, coming to your question on capacity utilization. So the North Troy capacity, for North it is 66%, for East it is 60% and for South it is 57%. Overall it is 62% as, which was almost the same, Obviously, this is at an expanded base because lot of capacities have also come up.

24:27 Now, on your question on which region saw the maximum growth as compared to last year, So, South of the, since the new plant has come in, so our growth was more in, 50 sales increased from 11 lakh tonnes to almost 16.9 lakh tonnes. And in North, there was a growth of 20%. So, these two regions for the maximum highest growth, these were almost flat as compared to last year. Good on, I would like to add one more thing. The South increase in South capacity utilization and IS growth is a factor of our selling more in the states of Maharashtra and Gujarat and not only South. South feeds West India market.

25:16 So we have been able to push our sales in Maharashtra and Gujarat majorly. This is helpful, sir. Just a follow-up here. This is an observation. Given that the East utilization, we have a lot of room there, and you're looking at flat volumes. So is it that the overall I mean, the industry Eastern market was flat or you've chosen sort of not to No, no, no, no, no. You, for comparison sake, you look at Nuvama results. You look at the conversion factor of Nuvama. They had a conversion factor of 1.7 and they could do that because they had better quality coal and they had better accessibility to scrap.

26:05 If I reach 1.7, I will beat hands down. I had a problem with my core quality, so I had to keep my conversion factor constraint and that is why I could not grow any that much. I have in the beginning of the of the call stated that on a consolidated basis, SHREE will gradually reduce from today eighty eight eighty, SHREE standalone will gradually reduce from eighty eight eighty nine to 75%. That means SHREE CEMENT EAST volumes and UAE volumes will go up substantially. Now this is a five year plan, give or take 5% here or there.

26:51 But please understand that East is typically a trade market, trades you can push more of convert, higher conversion factors cement and this time because of the coal quality, I could not increase the conversion factor. It is not that the flag is not available or fly is not available. It is only constrained by my own processes, disabilities due to low quality coal. Understood. This is very helpful, sir. And just to close the loop on the cost, but as you mentioned, most of the impact has been absorbed during 1Q. So is it fair to assume that 2Q, you're just broadly looking at operating deleverage?

27:41 I mean, that which would be seasonal and most of the West Asia crisis, the impact would be over, I mean, given the situation remains status quo? That is what I said, my friend, that if nothing drastic happens in Middle East, you should be able to look at, except for the quantitative variation, which is seasonal, you should see better profitability. Because my cost, which was likely to peak out in Q2 in floral has almost peaked out. I am saying again, the word almost. Don't take it that if I have 5% increase in fuel cost next quarter you will say, No. We expect as on date, the fuel cost should not shoot up provided calm prevails in Middle East and in the minds of our great U. S. President, Mr. Dorarta.

28:43 Understood, sir. This is very helpful and all the best. Thank you so much. Thank you, sir. The next question is from the line of Pinakin from HSBC. Please proceed with your question. Yeah. Thank you very much, sir. Sir, my first question is, while second quarter is seasonal quarter, if the external environment does not change, the energy prices, the coal prices are wherever they are, should the second half operating cost be lower than the first half operating cost? My dear friend, we anticipate so. But then we as you may be aware, we never give any EBITDA projections or anything because it is not in our hand, it is market related.

29:34 Today, as we are sitting on July 31, I can share with you that we have sold 3,100,000 tons in this month. The demand is okay, we are, our plants are operating okay, the fuel cost has not substantially increased and if CAM remains in Belize, it should not substantially increase, the gypsum cost should come down, the conversion factor should increase because of better quantity, better, sorry, larger quantity of pet coke being used, which all should result into better profit. Got it sir. So my second Why wait up to FY '2, Look at Q2 only, which is just three months away.

30:23 Got it, sir. So my second question is you mentioned that whatever happened in the trade versus non trade, will the situation normalize in the second quarter of trade sales going back to your historical averages? Or you see that happening gradually in the second half? Hopefully, yes. Hopefully, yes. And as you normalize and sell more in the trade segment versus 1Q, that should have a positive impact on pricing and EBITDA profitability. Right? That is a logical conclusion. Got it, sir. And lastly, sir, how up just today versus the June quarter averages in your key markets? So you are... Today means we are... So we have not even entered our month here.

31:09 How do I give you that number? Have given you the number for June quarter twenty six vis a vis June quarter twenty five. You are asking what is the average as of July 31, everybody fine. We are quite advanced in our digitization, but unfortunately, I am not... I don't have the ZIP on that number. You can send a mail to or mister Jain subsequently, and we'll reply to this. Got it, sir. Thank you very much. Thank you, sir. The next question is from the line of Siddharth from Kotak Securities. Please proceed with your question. Thank you for the opportunity.

31:56 Sir, just wanted to check, out of our around INR 200 odd crores EBITDA, which is not in the stand alone entity, what was the share of The UAE? Because you said the share of UAE went down drastically this quarter due to the war? Then come out again, please. Sir, out of the total EBITDA, which is there in consolidated but not in stand alone statements, which is around INR 200 odd crores, what proportion is from UAE? Well, I would not like to go into that kind of details for various reasons. But then it is out of UAE only. So, you can do your calculations, whatever you want to do. I will not go into specific number again.

32:44 Are interested in Grace business EBITDA. We have given you Grace Cement consolidated business EBITDA. We have given you Grace Cement consolidated quantity. You figure it out, my friend. You are Sir, on your sheet just let me put it another way. Basically, what is the number sitting in Indian operations, which is not there in our stand alone statement? My dear friend, I know how to catch the nose both ways. Straight and roundabout. You're not going to get this answer from me. Okay, sir. No worries. Sir, second, just a question, on the freight cost. Sir, I noticed that there are lower quarter on quarter despite this diesel price hike. Sir, any comments on this, sir?

33:33 Freight cost. Cost, sir. Yeah. You you do your math again. It's not lower. Okay, sir. Sir. Just a final bookkeeping question. So what would be our depreciation and tax rate for this year? INR 2,400 crores to INR 2,500 crores is the depreciation number. And the tax rate would be about 25, 30%. Okay, sir. Thank you. Thank you, sir. The next question is from the line of Rahul Gupta from Morgan Stanley. Please proceed with your question.

34:20 Hi. Thank you for taking my question. Just continuing on the previous question. In the last quarter, you highlighted that the UAE business reported $47.80 per ton of EBITDA. What would be that number in this quarter? I'm not going to share it. Then, sir, it's a request that please disclose the number for a... Your expanding UA business as a I have understood your request, and I am just with full day at saying that I will not disclose this number. Got it. Thank you so much. Thank you, sir. Have not disclosed 47 AED as EBITDA last quarter as well.

35:08 Last quarter, we had only discussed stand alone. This is the first time we are talking about consolidated results. Sir, you had reported $2.47 AED of revenues. What was that number this quarter? $247.80 is what? What is that number? What are the the U. Business? So what would be the similar revenues for the first quarter? I am again saying I have given you the quantity. I'm not going to give you the numbers. Thank you so much. Yep. Bye. Thank you, sir. The next question is from the line of from Nomura. Please proceed with your question. Referring to all these sales.

35:55 Hi, sir. Thank you for the opportunity. Sir, my my first question is largely on the demand front. Will it be possible to give some regional trend what you're seeing in different regions, both for the industry Raju and SHREE just shared how we fared in Q1. No, sir. I mean, 20 incremental demand in East and ours was South. South was significantly better because of new plants. South, you see, we had started new plant plus we could penetrate the West India market. So, have given you those nevertheless, pan India, the industry is expected to grow at about 7% to 8%.

36:48 We hope to catch up with 10%. 35.4 is what we did last year and I am right at about 40% this year. Understood, sir. I was actually looking forward to second quarter this month, how you're seeing healthy even do impact of... From Bombay, you can't look up to Calcutta. So travel 2,000 kilometers. Definitely, sir. Sir, my second question is largely on CapEx. If you can share the CapEx guidance for FY 2020 and also on the You market see, total CapEx I had guided Q4 about 1,500 crore.

37:34 For in Q1, we have done $4.56 crore. I maintain my guidance at about 1,500 crore for the year. Understood, sir. Thank you so much. And for North Sea, sir, although you will be commissioning that plant in FY 'twenty nine, end of FY 'twenty eight, I think. Q4 'twenty eight. Yes, Q4 FY 'twenty eight. Just wanted to understand how the economics will be or margins will be when we compare it to our Eastern Aftara, you have I think you have misread one number. You are getting guided by 19,800 crore for 1,000,000 ton plant, correct?

38:21 You are saying 18,000 rupees per ton capital cost, how the liability will come up. So, please understand that we have enough limestone in that region to go up to four to 5,000,000 tons. We are creating the infrastructure for four to 5,000,000 ton of final capacity. It is not that the first million ton is going to eat up entire capital. The facility is being created to for four to 5,000,000 tons. 1,000,000 we are starting to test the market and see how fast we can grow in that market. There are only two regions in Northeast, which can add cement, Assam and Meghalaya.

39:06 Meghalaya. Right? There are... There is almost a duopoly there, STAR and DALMIA. So, you know how things shape up, where duopolies are there. So, And we have never proven ourselves to be running fast enough to acquire $5 EBITDA plants at 110 CapEx. So, we are taking learning steps. We'll take our steps. And maybe then we should be able to come to 4,000,000 to 5,000,000 tonne of final capacity, if we take a short time. But we do have to create the visibility accordingly. No. Understood, sir. Thank you so much. It means that subsequent CapEx will be at lower rate. Just one, if I can squeeze in one just one last question, sir, if I can squeeze in that over the last year, SHREE CEMENT was doing a drive of improving realization Until last quarter, the drive had worked very well. You have reduced the gap to around INR 10 to INR 12 per bag, if I'm not wrong. Any improvement on that front in this quarter or for this year that you are No, in this quarter, there has been no improvement, but we are at it. This quarter, please understand, I had a lower quality of cement to sell or I had lower conversion factor. So my I was fighting on production front, I was fighting on cost front, I was trying to push

40:38 sales in non trade segment. So, this was not the ideal quarter. This was a very difficult quarter and we feel going forward, we should be on track to try and catch up the data. No, understood sir. It it makes sense. And I'll soon see you in Kolkata sir. Thank you so much. I'll join the Thank you, sir. The next question is from the line of Ritesh Shah from Investec. Please proceed with your question. Hi, sir. Thanks for the opportunity. Sir, would you like to highlight any specific cost levers that we are working on? Would love to hear from you commentary specifically on freight, rigs, rail deciding. I think that is one.

41:28 Now listen, let me give you an insight. At what scale is the fuel cost you can buy electrical commercial vehicles at 2.5 times capital cost. A 40 lakh commercial vehicle, ice based means diesel based, cost us 1 CR for electric, but then the cost of fuel comes to one tenth. Now, we are working on the volatility, we are working on all kind of adjustments in that. We are committed to commission about 100 commercial ECVs, e commercial vehicles in this year and hopefully it should keep us in good stead. Not only this, in our mining activity where you will use lot of dumpers and dozers and things like that, there is a good possibility of electric vehicles being substituting diesel vehicles.

42:30 So, we are working on all that, those are new cost levers. We are of course, keeping on looking for renewable energies. You will be surprised to note that our renewable energy component to total energy has increased from 61 to 65% in this quarter. So, we are working on all those levers. The the freight means the the lead distance, yes we are working on it. The railway sidings we have asked under the, what is that scheme they asked? Scheme. We have given some contracts, but the railways deliver at their own cost and their own pace.

43:16 So, all these are there. I had repeatedly told all you guys that the focus of free is not volume or top line, we are bottom line focused and we'll do all such things which augment our bottom line. And this is a for last forty years plus. Correct. Sir, would it be possible for you to quantify how much was the volumes by rail, say, last Nothing, year and where do yes. Rail was about 11% or 19%? 9%. 9%. Rail, we could do only 9% last year, in this quarter. Okay. Okay. And sir, last quarter you had indicated that we were exploring BEST as well. Any any progress over here, you had indicated that we could potentially laser at several of our plants?

44:08 You mean to say battery energy storage systems? Yes sir. Yes we have identified a few. We have implemented in a small way and if it succeeds, we'll go whole lot. Sir, will it be possible for you to explain? Sir, one second, best you have to understand. The biggest bottleneck in using best is that if you put in 100 units, you can extract only 85 units. 15% of the total energy stays within the base system. So, whatever cost advantage or disadvantage we have, we have to load it with a factor of 85% availability to come to actual cost benefit analysis.

44:55 Now, these are all theoretical calculations. That is why we have put in a small system, see how it works, what the viability is and then we can always multiply that number. Sure sir. And sir, just two linked questions. Sir, I think one of the quarters you had indicated that we are looking at metal besides splash as an alternative, basically in blended cement, sir, if you could No. I I said come back again. What's splash? Besides fly ash, we were looking at other cementitious material, which can actually go into PPC. Any any update over here, sir? No. We are still looking around. We still have got something. We can still use a few things. I would not like to share it for trade reasons.

45:45 But yes, we are working at additional SHREECEMENT LIMITED to increase or improve the conversion factor or bring my cost down. Okay. And sir, just last one, clinker factor, sir, how much was it for the quarter and any aspiration, say, We year out for were at 1.58 June 25 quarter. We are in this quarter 1.56. Okay. This is fine, sir. Thank you so much, sir. Thank you. Really appreciate it. Thank you, sir. The next question is from the line of from AMBIT Capital. Please proceed with your question. Hi.

46:30 Thank you. I just wanted to follow-up question on the Northeast on the timeline of April 28. On the media, we keep seeing all these news around public protest, public hearing protest and all. Just given the logistical today today morning, 08:30, there was a meeting and all approvals are in place. It is as of today morning, 08:30 meeting. So all your media reports, can put through, you can sell them. Okay. So just given the logistical challenges setting up a plant in North Asia Yes. Can outcome. It's never easy to make money, my friend.

47:18 So we have... We don't mind meeting all those challenges, and we have proven. We are the only Genius Book holder of commissioning a brownfield plant within fourteen months. So please don't doubt our capabilities. Okay. Thank you. Thank you so much. Thank you, sir. The next question is from the line of Navin Sahadeo from ICICI Securities Limited. Please proceed with your question. Yes. Yes. Thank you for the opportunity. Two questions. So you gave the CONSOL volumes as, of course, the stand alone volumes are reported in the press release. The difference is roughly a million ton.

48:09 And there is, of course, a calculated difference in the consolidated and stand alone. So is that on a per ton basis a representative of You are missing a point. In CONSOL, I have two more businesses. One is SHREE CEMENT East, where there is a base cement volume. The other is, I have an AAC plant. The third is, we operate through a 100% subsidiary, a station at Rypur. So, that you deduct this, you see the volume divided by volume and say, purchase order is the AED, purchase order rupee a ton is the EBITDA UAE. Look, can't adam it like that.

48:58 I am not giving you the number, I am not giving you the number. But then, I am saying that, hence, for please look at consolidated number also. Yes, sure. I appreciate that. My second question then was on the RMC. So in the previous quarter, I think revenues were about INR 90 crores, but we are scaling this up. Full year revenue also were around INR $2.40 odd crores. So is it possible to share Q1 Come back again. Come back again. I'm sorry. I missed the question. My question was on RNCV. So Your voice is cracking, my friend. Okay. I'll speak a little is it better now, sir? Otherwise, you can send me a mail. I'll answer you. Yeah. Okay. Fine. I'll do that. Thank you.

49:43 Thank you, sir. The next question is from the line of Rajesh Ravi from HDFC Securities. Please proceed with your question. Hi, sir. Just on the CapEx comment, I missed on that. You mentioned that around INR 500 odd crores was spent in Q1 and the remaining three quarters INR 1,500 crores or I misread that Total for the FY is about INR 1,500 crore. We have spent INR 500 crore in Q1. Sorry, your voice was not clear, sir. Total is how much? Total is INR $51,500. We have spent INR $4.50 plus in Q1. Okay. And for next year, what sort of CapEx one should work with? No, not at the moment. Please give me one more quarter.

50:34 I'll get back to you in H1 call call. Sure. And sir, RMC revenues were how much for this quarter and the March quarter? I'm asking Mr. Jain to answer to it. Yeah. The R and D revenue is one zero nine for this quarter. Yes. March quarter? March, 109% of this quarter, 90% of March 2640% of June 25. Okay. And this is already operating at what EBITDA margin, sir? I said there is no EBITDA at the moment in RMC, my friend. I said it right in the beginning.

51:21 Sorry. What is... Let all these plants stabilize. Understood. Okay. You guys get guided by the huge EBITDA number being reported by one of the peer group companies where they talk of four seventy four plants, now four seventy four plants is not under their direct ownership. It is under a franchisee model, maybe they are having 200, two fifty plants, balance is franchisee. They just, throw a number to you guys, nobody looks at the over three forty four seventy four plants. And now sir, just one small request because we would also love to work with the control numbers.

52:11 If it is possible to share for the benefit of everyone, we consolidated quarterly volumes for the last since start of FY 'twenty five. My dear friend, any detail you want, you will get it from my colleague, mister. You can send him a mail. Sure. Sure. But tell me one thing. This hair splitting exercise increases my remunerating power to my shareholders or it does nothing to it? Sorry, I'm not able to hear you properly, sir. I am saying that I'll give you all these numbers. These numbers you can have from Mr. But does it in any way impact my rewarding my shareholders?

52:57 My shareholders will get rewarded from console number only. Hence, only Correct me sir, that is why. Your analysis, you want these details to the extent possible, Mr. Will share it with you. You can trading on me. I believe the believe the console number is more representative of the company and that is why it is always great to have you know, work with a console number. Lovely. Lovely. Thank you. Thank you, sir. The next question is from the line of Harsh Mehta from MK Global Financial Services. Please proceed with your question. Yeah. Thank you for the opportunity. So I have couple of book bookkeeping questions. First one is the sequential change in the lead distance, and second is the net cash available in the balance sheet as on June 20.

53:53 June quarter. First of the lead distance, it has come down from $4.59 to $4.45. Okay? Okay. Now, net cash or consolidated cash, what do you want? I can give you my investment position, which has increased from $7.73, this is net cash. And look at the investment number, doesn't matter. You take net cash consolidated $7.77, double 3 was June 25, it has gone up to 8,003 and 48 in June 26. Investment number is there somewhere.

54:51 Anything else, my friend, Mr. Mittal? Sir, just wanted to understand from you, given that we have such amount of cash in our balance sheet, have you had the thought of scouting for any inorganic No, no, We are not in the inorganic game at all, my friend. I said, we don't have the heart to buy a $5 EBITDA capacity at $110 and then come and say, then come and have the chief to say that probably we have taken around this year. Got it. Thank you. These are the questions. You, sir. The last 40, my friend. We understand it. The next question is from the line of Girija Ray from Niribar Bank. Please proceed with your question.

55:45 Hi. Thanks for taking my question and many congratulation for one particular thing that is the capacity utilization, which has increased this quarter. So I'm very happy that capacity utilization is stands at 61%, 62%. That is the only concern with me. So how do you see the pricing is going to pan out going forward? Pricing? Yes, yes. Because, see, we are ahead of this concern. I've never in my 40 taken a call on how the selling price will be here. Sorry. It's a market related activity. I don't take a call. I don't want to take my investors up the garden path.

56:30 You do your own estimation and calculation. I can give you a broad guidance on what the cost will be provided external environment remains same. It has given. But price, I don't take a call, my Thank you, sir. Thank you very much. Thank you, sir. The next question is from the line of Prateek Kumar from Jefferies. Please proceed with your question. Yeah. Hi. Good evening, sir. I have just couple of questions. Firstly, on on your Go Go ahead. Go ahead. We have already passed one hour here. I have a flight to cancel me. Just one question then. Like in quarter two, like you said, all your variable costs have peaked. So on our total cost of operations, except for operating leverage, this could be like 100 to 150 rupee.

57:22 They're not looking at any cost changes quarter on quarter. I know it's a repetition. Wait a minute, my friend. I have said that Q1 is a non comparable, non standard quarter. I have said that. Have we ever come down to 9% pet coke use? It's unimaginable. So please, Q1, you granted the leeway where it was extremely difficult for us. Can you imagine, SHREE CEMENT selling maximum in non trade whereas last three years we have been talking of premiumization, we have been able to reduce the delta between the peer group and us.

58:10 This is absolutely a normal quarter. Please give me one more quarter. H1, we'll talk more meaningfully. Sure. Thank you. And just just confirming, 1,500 crore CapEx, which you said includes your UAE expansion. So it's a consolidated guidance for your No. No. UAE is... Wait. One second. One second. One second, my dear friend. 1,500 crores India operation. Thank you very much for pointing it out. UAE expansion is already underway and it is being funded out of UAE operations only. We are not submitting anything for UAE. There is enough cash sitting out there. So what is the console CapEx guidance for the company as you move to console model now? I'm I'm I'm I'm very sorry, Prateek. I should have had this number. I don't have it.

59:00 I I will share it to you as soon as I go back to calculate it. Today, I'm in. I should be there by four or fifth. We'll share this because I just have to look at the UAE data. That's all. Sure. Thank you, These are my questions. Yeah. Thank you, sir. Ladies and gentlemen, in the interest of time, that was the last question for today. I would now like to hand the conference over to management for closing comments. Hi, I just want to repeat what I have been saying on this call. Please consider Q1 as an abnormal quarter. I expect to do better Q2 onwards, if nothing untoward happens on the minister's firm.

59:48 Hopefully, we should regain our supremacy in trade sales and let us see how things pan out. Thank you very much and have a great day. Thank you sir. On behalf of ICICI Securities Limited, that concludes this conference call. Thank you for joining us and you may now disconnect your lines. Thank you.