Key Financial Metrics and Operational Data

Q1 FY27 Performance:

  • Consolidated EBITDA: INR 286 crore (16% decline YoY)
  • Net debt: INR 2,300 crore as of 30th June, 2026
  • Capex: INR 120 crore for the quarter
  • Incentive accrued: INR 33 crore (compared to INR 60 crore in Q4 FY26)
  • Mukutban volume: 7.5 lakh tons
  • Total lead distance: 335 km
  • Mukutban lead distance: 400 km
  • KCal cost: 1.64
  • Packaging cost: INR 269 per ton (vs. INR 191 in Q1 FY26)

Volume and Realization:

  • Company achieved over 90% capacity utilization
  • Realization declined by INR 40 per ton sequentially, but increased by INR 80 per ton excluding impact of lower incentives and year-end adjustments
  • Trade segment constitutes over 80% of sales
  • Blended cement constitutes 85% of product mix

Cost Structure:

  • Cost increased by INR 150 per ton in Q1 due to geopolitical factors affecting fuel and packaging
  • Expected further cost increase of INR 70-80 per ton in Q2 FY27
  • Mechanical mining in Rajasthan affected by diesel cost inflation
  • Limited ability to use domestic coal compared to peers

Capacity Expansion and Projects

Current Status:

  • Kundanganj Line 3 commissioned, increasing dependence on Central India market
  • WHRS capacity: 43-44 MW with pipeline projects to increase to 50 MW
  • Maihar Line 2 will add 17-18 MW WHRS capacity

Future Plans:

  • Maintaining guidance to reach 27.6 MTPA capacity by FY29
  • Capex guidance maintained at INR 900 crore for FY27
  • Significant capex increase expected in FY28 (approximately INR 2,500 crore)
  • Bikram coal production: 1.2 lakh tons in FY27, planned increase to 3.5 lakh tons in FY28
  • Bikram coal to meet one-third of CPP coal requirement

Market Dynamics and Strategy

Regional Performance:

  • Central India prices remained soft for approximately one year due to competition dynamics
  • Limited benefit from price recovery seen in North and East markets
  • Small presence in East region limited upside from regional price improvements
  • Maharashtra (Mukutban) operations affected by logistics disruptions, losing some volumes

Pricing Strategy:

  • Management committed to trade-focused strategy (85% blended cement)
  • Reluctance to shift to non-trade segment despite better realizations
  • Exploring alternative strategies to protect margins if trade prices remain subdued
  • Expecting more enlightened competition despite new capacity additions

Competitive Landscape:

  • JP's assets being ramped up under Dalmia ownership in Central region
  • No expectation of price war from new entrants due to past experiences
  • Some industry players deferring capacity expansion to FY30

Guidance and Outlook

Maintained Guidance:

  • Volume growth guidance maintained
  • Net debt guidance maintained around INR 2,000 crore for FY27
  • Peak net debt not to exceed 2x net debt EBITDA
  • Total incentive expected: INR 130-135 crore for FY27 (including Mukutban and Kundanganj)

Market Outlook:

  • Demand remained buoyant from middle of May through June 2026
  • Delayed monsoon supporting continued demand into July
  • Concern about potential carryover impact into Q3 if agricultural scenario weakens
  • Pricing recovery expected in coming quarters

Management Commentary

Sandip Ghose, MD & CEO, noted the company was "victim of our own success" due to maxed out trade sales where price increases didn't materialize, while non-trade segments saw significant recovery. He emphasized the company's commitment to blended cement as sustainable and environmentally friendly, while acknowledging need to revisit strategy if larger players don't show interest in raising trade prices.

Aditya Saraogi, Group CFO, clarified that the apparent INR 40/ton realization decline was actually an INR 80/ton increase when excluding the impact of lower incentives and year-end adjustments. He highlighted the full impact of cost pressures would be seen in Q2 FY27.