Blended Fuel Cost: INR 1.52 per kcal (consumption)
Trade Share: 77%
Strategic Updates & Expansion Plans (Capex)
Nimbol, Rajasthan Plant: Capacity revised upwards to 6 MTPA (from 5 MTPA). Clinker capacity is 3.3 MTPA (rated, can produce ~3.6 MTPA) with a 3 MTPA grinding unit in Jhajjar. Total project cost estimated at ~INR 3,080 crores.
Timeline: Ground-breaking scheduled for 1st December 2026. Expected commissioning by July-August 2028 (Q1/Q2 FY29). Environmental Clearance (EC) is expected to be granted within a week or two from the call date (12th Nov 2026).
Eastern Grinding Unit: A decision is pending between setting up a 2 MTPA unit in Bihar (Greenfield, ~INR 550 cr capex) or West Bengal, Siliguri (brownfield, ~INR 350 cr capex). The West Bengal option is being favored due to a new industrial policy and existing infrastructure. A decision is expected by the next earnings call.
Capex Phasing (Guidance from Q1 Presentation): FY27: INR 560 crores, FY28: INR 1,910 crores, FY29: INR 610 crores. Management noted these figures are estimates and subject to optimization and potential use of buyer's credit, which could shift outflows between FY28 and FY29.
Funding Strategy: The company intends to fund expansions through debt and internal accruals. A QIP is not currently being considered as net debt-to-EBITDA is not expected to cross 1.5x.
Long-term Capacity Target: The company aims to reach 20 MTPA capacity by 2030-2031.
Guidance & Outlook
Volume Growth (H2 FY27): Management expects 12-13% YoY volume growth in the second half of FY27, driven by pent-up demand following state elections and floods in Assam. October 2026 volumes already exceeded this growth rate.
Full-Year Volume Growth: The company maintains its expectation of 7-8% full-year volume growth.
Realizations: Prices increased by INR 10 per bag in Northeast and INR 10-15 per bag in outside Northeast (West Bengal) markets in October 2026. The increase in Northeast is expected to sustain.
EBITDA Guidance: Management reaffirmed its full-year EBITDA per-ton guidance, confident it will be achieved despite a softer H1.
Fuel Cost Outlook: Blended fuel cost is expected to be maintained around INR 1.5 per kcal in Q3 and Q4, benefiting from a 3-month coal stock and resumed FSA deliveries. The target is to reach INR 1.45 by March 2027.
Incentive/Subsidy: The run rate of ~INR 36 crores per quarter is expected to continue in Q3 and Q4 FY27, with H2 FY27 subsidy accrual projected at INR 65-70 crores.
Non-Cement Revenue: Full-year target is ~INR 100 crores.
Silchar Plant: The railway siding is expected to be operational by January 2027, leading to operational savings from Q4 FY27 onwards.
Market & Competitive Landscape
Northeast Market: The company estimates 15-16% of the Northeast market (approx. 2.4-2.5 MTPA) is served by cement imported from outside regions like Chhattisgarh and West Bengal.
New Competitors: Management acknowledged expansion plans by Ambuja Cements (4 MTPA), JK Lakshmi (1 MTPA EC), and Shree Cement in the Northeast. They expect new capacities to take 2.5+ years to commission and believe the market will have grown enough to absorb them by then. Short-term pricing pressure is expected, but long-term stability is anticipated.
Industry Growth (Northeast): Management estimates industry volume growth in Northeast India will be 7-8% for H2 FY27 and the full year, while Star Cement expects to outperform with double-digit growth due to available capacity.
