Nuvoco Vistas Corporation Ltd — Q4 FY26

Nuvoco Vistas Corporation Ltd Q4 FY2025-26 Earnings Conference Call https://www.youtube.com/watch?v=qN1VNKgxMyU Published: 4 weeks ago

0:01 1 second Ladies and gentlemen, good day and welcome to the Novokco Vistas Corporation Limited Q4 FI26 earnings 0:08 8 seconds conference call. As a reminder, all participant lines will be in the listen only mode and there will be an opportunity for you to ask questions 0:16 16 seconds after the presentation concludes. Should you need assistance during the conference call, please signal an operator by pressing star then zero on 0:24 24 seconds your touchstone phone. I now hand the conference over to Mr. Vishnu Sharma, head of investor relations from Novokco. 0:31 31 seconds Thank you and over to you. 0:34 34 seconds Good evening everyone and a warm welcome to Novokco's FI26 earnings call. We appreciate you taking the time to listen 0:42 42 seconds to us. Uh let me begin by sharing a few few key highlights as we reflect on our performance in fiscal year 2026. 0:52 52 seconds We ended the year on a high note and delivered the strongest annual performance for Novoko. We achieved the 0:59 59 seconds highest volume of 20.4 million tons and AITA of 1,881 crores in the history of the company. We 1:08 1 minute, 8 seconds expanded our industryleading premise base by 300 basis points year to 43% in 1:15 1 minute, 15 seconds FI26 and thus establishing a stronger base going forward. 1:21 1 minute, 21 seconds The fourth quarter was also a landmark quarter as we for the first time reached a 6 million ton volumes with a historic high quarterly bit of 580 crores. 1:32 1 minute, 32 seconds We witnessed improvement in overall demand during fourth quarter as the capex by both state and central 1:39 1 minute, 39 seconds government gained momentum which is up by approximately 12% in Q4 till February 1:46 1 minute, 46 seconds supporting infrastructure activities and demand. Overall in our view view we performed well in FI26 despite the 1:54 1 minute, 54 seconds challenging market conditions and headwinds witnessed during Q2 and Q3. 2:01 2 minutes, 1 second On the growth agenda, we are pleased to share that the Badra cement project is progressing well and remains on schedule. The clinker unit and grinding 2:10 2 minutes, 10 seconds units are planned to be commissioned in phases between Q3 FI 27 and Q1 FI28. 2:18 2 minutes, 18 seconds Let me give you a quick on the ground update on project execution at both our Kaj and Surat facilities. 2:27 2 minutes, 27 seconds In Surat grinding unit, key equipment and spare deliveries are completed. The 66 KV grid connection has been 2:34 2 minutes, 34 seconds established. Equipment upgradation and electrical installations are nearing completion and trials commenced. In K 2:42 2 minutes, 42 seconds clinker unit, equipment accreditation and electrical panel testing are underway. Cyclone inspection for 2:49 2 minutes, 49 seconds refractory assessment is in progress and deliveries are on track. In Kud grinding unit, civil works are on track with work 2:58 2 minutes, 58 seconds on silo VRM foundation, packing plant and copper building processing as scheduled. 3:04 3 minutes, 4 seconds Installation work of VRM has also started for cut railway siding. Engineering 3:12 3 minutes, 12 seconds scale plan and detailed project report approvals from Indian railways is at an advanced stage and site execution has also commenced. 3:21 3 minutes, 21 seconds We are also establishing a bulk cement terminal at Viram Sachana, Gujarat with a dedicated railway signing and a 3:30 3 minutes, 30 seconds handling capacity of approximately 1.5 million tons per. The terminal will enable efficient unloading and storage as well as dispatch of loose bag cement. 3:44 3 minutes, 44 seconds It will serve as a strategic distribution hub to expand our reach across the Gujarat market with commissioning targeted for FI28. 3:53 3 minutes, 53 seconds Alongside this project, our east expansion program of adding 4 million tons peranom of grinding capacity in 4:00 4 minutes phases through FI28 is also progressing well. 4:04 4 minutes, 4 seconds Looking ahead, we remain confident that the structural demand story for tremendous impact on infra central 4:13 4 minutes, 13 seconds government capex for FI27 is planned to grow by 20%. And state government capex to grow by 15% implying a meaningful 4:21 4 minutes, 21 seconds step up in construction activity. On housing the PMI dram allocation is up 73%. 4:28 4 minutes, 28 seconds And in the east specifically state governments have planned housing schemes worth approximately 29,000 crores for 4:37 4 minutes, 37 seconds FI27 which is directly positive for Nou given our leadership in the geography. 4:44 4 minutes, 44 seconds Moreover, the Asian Development Bank recently revised India's FI27 GDP growth 4:50 4 minutes, 50 seconds estimate upward by 40 basis points to 6.9% with a further acceleration to 7.3% projected for FI28. 5:01 5 minutes, 1 second This is a constructive signal for cement demand going forward. 5:06 5 minutes, 6 seconds While the structural demand outlook remains positive, we are mindful of near-term headwinds saving from current geopolitical uncertaintity. 5:16 5 minutes, 16 seconds Rising fuel prices, currency volatility, escalation in raw material cost particularly for packing materials could 5:25 5 minutes, 25 seconds exert pressure on margins in at least one to two quarters going forward. 5:31 5 minutes, 31 seconds We are closely monitoring the situation on the ground. We have already initiated proactive measures of price hikes, 5:40 5 minutes, 40 seconds prudent procurement practices, accelerated cost optimization initiatives and strengthening supply 5:47 5 minutes, 47 seconds chain efficiency to mitigate the impact and protect our margin profile to the extent possible. Uh with that I conclude my opening remarks. I'm here with Mr. J. 5:58 5 minutes, 58 seconds Kumar Krishna Swami, managing director of Novoko Vistas and Mr. Manish Agarwal, CFO, Chief Financial Officer. We are 6:07 6 minutes, 7 seconds happy to answer any questions you may have. Thank you very much. Over to you. 6:13 6 minutes, 13 seconds Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press 6:20 6 minutes, 20 seconds star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are 6:29 6 minutes, 29 seconds requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. 6:40 6 minutes, 40 seconds We'll take our first question from the line of Sedhart Meotra from Kotuk securities. Please go ahead. 6:47 6 minutes, 47 seconds Uh thank you sir for the opportunity. 6:50 6 minutes, 50 seconds Sir, one quick question on our Apex. Now it seems that when we first announced the expansion, 6:57 6 minutes, 57 seconds you have to speak a little bit louder on the mic or if it's on the handset so we can't hear Is it better now? 7:04 7 minutes, 4 seconds Can you use your handset mode, please, Siddhart? 7:06 7 minutes, 6 seconds Yeah, I'm using my handset mode. Is it better? Yeah, go ahead. 7:11 7 minutes, 11 seconds Yeah. So, I just wanted to check uh at the time when we submitted our uh east debottlenecking plans. I think it was 7:19 7 minutes, 19 seconds mentioned that we plan to have them pro possibly by the end of FI 2027 with certain capacities uh uh coming online even by the end of FI 2026. 7:31 7 minutes, 31 seconds Now it seems that we've slightly delayed those plans. So I mean if you could help me sort of understand what sort of timelines we are looking at with respect 7:40 7 minutes, 40 seconds to the expansions in the east that would be really helpful. 7:45 7 minutes, 45 seconds Okay. Thank you. So as mentioned in a couple of calls ago, we had clearly mentioned that we are doing a debutling 7:51 7 minutes, 51 seconds of just about 4 million t capacity expansion in east with million ton coming from all the four plants of Jojo 7:59 7 minutes, 59 seconds Vera, Orisa cement plant, Panagard cement plant and Raspa cement plant. The timelines we had mentioned was in end of 8:08 8 minutes, 8 seconds FI26 or Q1 FI27 we will commission Joj Vera Panagard and then subsequently Jajpur and last will be Aras Meta. So we 8:16 8 minutes, 16 seconds have more or less done the debotting in Jojo Vera as well as Panagarad. We're just waiting for the uh CTO. So NAPL has 8:25 8 minutes, 25 seconds been completed which is this uh no increase in pollution load with there's a clause which says that much amount of expansion you can do that is already 8:34 8 minutes, 34 seconds done and uh we just waiting for the final approval to happen. So in terms of hardware modification it's all done in this two plants. JPU should happen in 8:43 8 minutes, 43 seconds the next two to three months and ARSA will happen by the end of this year. So certainly by the next few weeks or a 8:51 8 minutes, 51 seconds month or so we should be able to uh once the CTO come we should be able to make an announcement on uh completion of this expansion. 9:02 9 minutes, 2 seconds Understood. So everything should be online by the end of FI 2027. Is that correct? Uh the correct 9:09 9 minutes, 9 seconds Definitely definitely it should solve more waiting for the co to happen. 9:15 9 minutes, 15 seconds Understood. Uh second we sir quickly on the fuel mix given the sort of volatility in the energy markets due to 9:22 9 minutes, 22 seconds the ongoing conflict could uh could you just uh tell me what is our current kal cost and uh what sort of change do we 9:31 9 minutes, 31 seconds sort of expect once we sort of transition to the newer pet scope procurement or co procurement as the case may be and what sort of price 9:40 9 minutes, 40 seconds increases we're looking at on the power and fuel cost side yeah I is uh number of things which he 9:48 9 minutes, 48 seconds asked. Basically the impact has happened on three levels. One is obviously uh petco. Second is impact of international 9:55 9 minutes, 55 seconds coal prices in the domestic coal prices and the third one is the impact of uh rupee depreciation because all the petco 10:03 10 minutes, 3 seconds is imported. In Q4 our blended fuel cost for the company was 1.44 uh rupees per 10:11 10 minutes, 11 seconds million cap and that was more or less same as the previous quarter. We were already done at 1.43 types. So we are more or less little bit more than that 10:19 10 minutes, 19 seconds but at 1.44 not too much of a difference. But then as we enter Q1 uh petco which was at 1.84 rupees per 10:28 10 minutes, 28 seconds million cal is becoming 2.01 rupees per million cal and we also have adequate stocks for 6 to 8 weeks and some of the 10:36 10 minutes, 36 seconds orders which you booked on petco or on high seas at the rates which were prevailing uh during middle of March or end of March. So we are forcing a number 10:46 10 minutes, 46 seconds of in Q1 anywhere between 1.51 to 1.55. 10:51 10 minutes, 51 seconds So we will also keep on altering uh the mix to ensure that we get taka coal or eastern query score or increase or 11:00 11 minutes decrease of AFR. So that's why we should have a range of close to about 1.51 to 1.55 should be the number I foresee for 11:08 11 minutes, 8 seconds Q1. uh but all the shipments which are currently booking which should come around July August which will have the impact for Q2 there I guess there will 11:17 11 minutes, 17 seconds be a further increase in uh uh blended cost for the company and there I think it's too early for me to give an outlook what will be the cost as we see because 11:25 11 minutes, 25 seconds we are already booking now and but suffice to say that this 1.5 1 to 1.55 which we are forecasting for Q1 will 11:34 11 minutes, 34 seconds further increase in Q2 so that's the outlook I can give obviously All this will have an impact on the uh energy 11:41 11 minutes, 41 seconds cost for the company. Uh few things which you have taken uh during the month of March and certainly in the month of 11:47 11 minutes, 47 seconds April. Uh from the exit prices of March into the prices in April, we have taken price increases in both the trade and 11:55 11 minutes, 55 seconds non-trade channel in all our markets. In each markets we have taken a price increase of rupees 10 in the trade channel in across the states of Bihar, Jarkan, Bengal, Chhattisgarh and Orisa. 12:06 12 minutes, 6 seconds And on the non-trade side we have taken close to about 20 rupees uh rupees per ton rupees per bag uh price increase in 12:14 12 minutes, 14 seconds all our uh states. So east has been 10 per bag in trade and 20 per bag in non-trade is a price increase we have taken and this has not happened on 1st 12:22 12 minutes, 22 seconds of April. has happened around 6th 7th and then nontra typically price increase we take at on the 10th once we finish the orders for the previous month and 12:31 12 minutes, 31 seconds hence I think we would get a uh number which will be anywhere between 7 to 10 rupees for the full month and also non 12:38 12 minutes, 38 seconds trade could be uh uh 12 to 18 rupees for the full month that's on the east side on the north side similar price increases which we have taken in all our 12:47 12 minutes, 47 seconds key markets of Rajasthan Gujarat western MP and Punjab and uh uh western UP there 12:55 12 minutes, 55 seconds we have taken a 10 rupee price increase in uh trade and uh non trade has been different in different places close to 15 rupees price hike in Gujarat and 13:03 13 minutes, 3 seconds about 10 rupees price hike in Rajasthan, Hariana and Western here again if you see a blended price increase in trade should be anywhere between 8 to 10 13:11 13 minutes, 11 seconds rupees and non trade will be uh 10 to 12 rupees. So technically across the markets that we operate we can say that 13:18 13 minutes, 18 seconds we we we will we want to inform that price increase we have taken is anywhere between 10 to 8 to 12 rupees on trade and 10 to 15 rupees on non-rade. 13:29 13 minutes, 29 seconds Thank you sir for the detailed answers. Good luck. Thank you. 13:33 13 minutes, 33 seconds Thank you ladies and gentlemen. In order to ensure management is able to answer queries from all participants kindly restrict your questions to two at a 13:41 13 minutes, 41 seconds time. You may join back the queue for follow-up questions. 13:45 13 minutes, 45 seconds We'll take our next question from the line of Pinakin from HSBC. Please go ahead. 13:54 13 minutes, 54 seconds Pakin, your line is unmuted. Please go ahead with your question. 14:02 14 minutes, 2 seconds Since there is no response, we'll move on to the next question. Next question is from the line of Naven Romeshwar Sahadevo from ICA Securities. Please go ahead. 14:13 14 minutes, 13 seconds Yeah, good evening uh and thank you for the opportunity. Uh two questions. One was if you could talk more about the 14:22 14 minutes, 22 seconds cost that we cost impact probably which we faced in uh March month in particular 14:29 14 minutes, 29 seconds because ever since this uh Middle East crisis broke out we were hearing a lot about issues related to the packaging 14:37 14 minutes, 37 seconds cost especially the bag not being available and the so did we face any impact in the month of March or we had 14:44 14 minutes, 44 seconds inventory so the impact of that front would come in in Q1 and my then related 14:52 14 minutes, 52 seconds to this my cost uh related to the same cost angle my uh second question was 14:59 14 minutes, 59 seconds what was the pet folk mix in this particular quarter and how flexible is it uh to like you know I'm assuming we 15:08 15 minutes, 8 seconds would be looking to lower it so uh how flexible how much could it go down further and offset by domestic coal so 15:15 15 minutes, 15 seconds as to mitigate the impact that is My first question. 15:19 15 minutes, 19 seconds Okay. Uh fine. In the previous question uh which was asked I responded only for the petco uh and energy cost movement 15:28 15 minutes, 28 seconds from Q4 to Q1 in terms of rupees 3 million cal. Of course in the month of March uh we had a relatively sizable 15:36 15 minutes, 36 seconds impact which came from the packaging backs and granules. The granular prices in the market uh which was at 99 rupees 15:45 15 minutes, 45 seconds per ton per kilo which was in February uh over multiple phases have shot up to 15:52 15 minutes, 52 seconds 155 rupees per kilo which resulted in increase in uh uh cost of packing bag 16:00 16 minutes and that did impact the uh March costing of uh bags. We had a 16:08 16 minutes, 8 seconds overall impact of close to about uh rupees 20 per ton uh as a consolidated 16:15 16 minutes, 15 seconds level for the company. But uh that is for since we also carried sufficient uh 16:22 16 minutes, 22 seconds what do you call backs inventory as well as uh we are on a granule conversion model. So we also had granules of 16:29 16 minutes, 29 seconds different values with us and hence the impact which happened in the month of March was close to about 20 rupees per 16:37 16 minutes, 37 seconds uh ton but the number is going to further increase in the month of April. 16:40 16 minutes, 40 seconds Certainly already we are looking at a uh close to about 100 rupees per ton increase due to packing bag uh cost 16:49 16 minutes, 49 seconds increase and granular cost increase and conversion cost increase which has happened. So that's something which uh 16:55 16 minutes, 55 seconds currently loaded on the cost line. Uh certainly I have no uh view on whether this 100 will remain 100 or it will go 17:04 17 minutes, 4 seconds up. That's all subject to the granual cost which is kind of gone up from 99 to 120 to 140 to 150 to 155 in multiple 17:12 17 minutes, 12 seconds steps. uh currently it's holding out at this kind of number but if the conflict were to continue for longer and then we are going to have issues with incoming 17:21 17 minutes, 21 seconds crude I think this number uh will also have uh negative side uh because the government of India has already asked the granule manufacturers to divert 17:30 17 minutes, 30 seconds crude for making LPG and other stuff and there is a general shortage of uh granules in the market so uh April we're 17:37 17 minutes, 37 seconds looking at a 100 rupees uh per ton increase in packing back cost and May in June uh could be I can't make a guess it 17:46 17 minutes, 46 seconds it could be at this level or a little bit uh go higher also in the uh coming months other than that the cost 17:54 17 minutes, 54 seconds inflation did not happen in March but will happen going forward is uh uh the cost of mineral gypsum uh mineral gypsum 18:02 18 minutes, 2 seconds is also used in manufacturer of cement along with FGD as well as chemical gypsum and there we can see close to about 20 rupees per ton increase because 18:11 18 minutes, 11 seconds of uh mineral gypsum import cost most of the mineral gypsum comes from Oman and there again the supply lines are cut so 18:19 18 minutes, 19 seconds the second question is you ask what is the company doing to mitigate this cost inflations as far as bag is concerned 18:27 18 minutes, 27 seconds it's going to be difficult because it's not possible to mitigate because that's the only only source is the granular manufacturer in the country like IO IOC 18:35 18 minutes, 35 seconds or reliance so that's where the granules come and there I think there is a challenge so it can't be mitigated it can be only offset by price increase. As 18:44 18 minutes, 44 seconds far as petco increase obviously we have a formula we have a fuel makes in east and north is different. No is also close 18:52 18 minutes, 52 seconds to about 70 plus percentage sales which happens through east market and there our key factories of Arisa, Sonad and 19:01 19 minutes, 1 second Rizra. One of the things which we have done in our three plants is we have uh reducing continuously the use of petco. 19:11 19 minutes, 11 seconds We are changing the fuel mix in the caler and we are changing the fuel mix in the main kill. As we speak, people are all working on this effort to reduce 19:18 19 minutes, 18 seconds the pet coke consumption in aras meta and sonar to less than 20% from the current 25 odd percent and also from 19:26 19 minutes, 26 seconds result from the current 35% to less than 30%. So that's going to have a uh good uh good impact and with this reduction 19:35 19 minutes, 35 seconds we're also looking at other coal sourcing from eastern coreries and chacha coal and various other coal initiatives. So the blended cost is 19:43 19 minutes, 43 seconds being controlled by reducing the petco consumption as well as try and get uh local coal which will offset the overall 19:51 19 minutes, 51 seconds cost. Local coal prices has also gone up but overall I guess the initiatives are being taken to reduce the consumption of 19:58 19 minutes, 58 seconds pet coal pet coke by at least 300 to 500 basis points from Q4 actual consumption. 20:04 20 minutes, 4 seconds That's on the eastern side. On the northern side again we have entered into some unique coal contracts with uh 20:10 20 minutes, 10 seconds central India as well as uh from Varnasi depot to get also some domestic coal which we have not used in the past to be 20:18 20 minutes, 18 seconds used in the kil in our chit factory there again our target of petco consumption which was in the 55 and 60 20:27 20 minutes, 27 seconds person has been brought to 50 and we are further reducing to 45% by use of domestic coal in nimol we are still 20:34 20 minutes, 34 seconds trying to work put some new alternative to see whether ligignite can be blended on the scale and reduce further the petco consumption. So technically 20:42 20 minutes, 42 seconds speaking in northern plant our petco consumption from 50 we're trying to come to 45 uh which with the efforts of a 20:49 20 minutes, 49 seconds manufacturing team will be able to certainly reduce by 200 to 300 basis points. Number two, increase of AFR in 20:56 20 minutes, 56 seconds these two plants. We have full-fledged investment done in Storin Nimble for AFR processing uh which will 21:05 21 minutes, 5 seconds have the refused uh material or carbon black or rest of all the stuff. So, north is going to be unique domestic coal into these plants. 21:16 21 minutes, 16 seconds Number one agenda. Number two agenda is to try and see whether we can process ligignite. Number three agenda is to increase our ASR quantity so that our 21:24 21 minutes, 24 seconds cost in north is brought down to less than 50% of petco consumption. East is going to be uh overall reduction in 21:31 21 minutes, 31 seconds petco by about 300 to 400 basis points supplemented by increase in use of ja coal coal uh coal waste or get it from 21:42 21 minutes, 42 seconds eastern coilies. So that's the broad uh work the teams are doing and on uh gypsum usage a big initiative 21:50 21 minutes, 50 seconds we are doing is to find out how can we supplement mineral gypsum from replace mineral gypsum with FGD gypsum. I think 21:57 21 minutes, 57 seconds our procurement teams are working with uh nearby power plants in all the plants to try and increase use of FGD gypsum in 22:05 22 minutes, 5 seconds all the plants uh which will reduce the cost of gypsum usage. So gypsum will be controlled. Uh fuel costs we are working 22:13 22 minutes, 13 seconds on. Uh bags I don't think at this point of time uh there's a clearcut uh way forward. So we'll have to live with the 22:20 22 minutes, 20 seconds price increase and that's broadly the agenda for the company to mitigate the cost challenges. 22:28 22 minutes, 28 seconds Uh yeah so thank you for the thank you for the detailed reply. My my second question then was on the pricing and the 22:35 22 minutes, 35 seconds competitive intensity. So uh you did mention in your uh I think previous questions that uh the range of price 22:42 22 minutes, 42 seconds hikes that have happened both in uh north and uh and as well as the east region. I think similar sort of a commentary uh we had I think uh 22:52 22 minutes, 52 seconds witnessed or heard uh in the previous call also uh at the time of January that there is uh some price hikes uh despite 23:01 23 minutes, 1 second peak season demand. I think the price hikes that have happened in March a quarter as a whole have been a little 23:08 23 minutes, 8 seconds underwhelming just about 2% or so. So I just wanted to get your views about the confidence of this price hikes uh now 23:17 23 minutes, 17 seconds sustaining because uh I think April May onwards you also start seeing the seasonary week monsoons coming through 23:26 23 minutes, 26 seconds and then the impact of overall volume and the regular week season thing. So do you think these price hikes in April are 23:32 23 minutes, 32 seconds more sustainable or you think it can still be some uh like it could still face challenges uh with the onset of monsoons? Thank you. 23:44 23 minutes, 44 seconds Demand supply and pricing typically will go through the classic demand supply model but right now we are not on 23:52 23 minutes, 52 seconds certainly demand supply framework at all. These are all uh unique times. Uh and uh if you see almost every industry 24:00 24 minutes and every sector in India has taken price increase. Paint industry, uh adhesive industry, automo industry, SMCG 24:10 24 minutes, 10 seconds industry, almost every industry whose raw material is crude linked have taken price increase. So there is no escaping 24:17 24 minutes, 17 seconds the fact that we will not absorb this we will absorb this uh inflation and uh reduce the profitability of the company. 24:25 24 minutes, 25 seconds So unlike in in a normal scenario where demand peaks and or demand drops and then supply is there there'll always be 24:32 24 minutes, 32 seconds pressure on uh pricing but these are all abnormal times and I guess every player in the industry in our sector or outside 24:39 24 minutes, 39 seconds the sector is facing the impact of uh crude and I am fairly confident that the 24:48 24 minutes, 48 seconds price hikes which we have taken will stay put in the near term and uh hopefully further cost inflation doesn't happen then we could we I am confident 24:57 24 minutes, 57 seconds we can stabilize with the current prices but uh I certainly feel that if further cost inflation happens I guess we'll 25:05 25 minutes, 5 seconds have to find a way to pass on the cost inflation uh down so that's the view I have and that's how uh our thought 25:14 25 minutes, 14 seconds process is yeah so just to conclude uh we will see more price hikes if there is a further 25:21 25 minutes, 21 seconds cost inflation otherwise so far the cost uh the price hikes are are good enough is that the way to uh look at it 25:30 25 minutes, 30 seconds if you really put the mathematics of it so I cannot get into details of the total cost increase and the total price increase obviously 100% one cannot defay 25:39 25 minutes, 39 seconds on step one but by and large the efforts which we have taken uh to take the prices up and trade uh still doesn't 25:49 25 minutes, 49 seconds meet all the cost inflation but there again I think efficiency programs are being run in the factory to offset the impact of the cost inflation but 25:56 25 minutes, 56 seconds certainly supported by price increase geomix product portfolio and uh trade 26:04 26 minutes, 4 seconds non-trade ratios all the other agenda which we are working so it's not like 1 is to1 ratio cost increase by 100 price increase by 100 that's not the way one 26:12 26 minutes, 12 seconds works so I guess there is certainly acknowledgement there's a cost increase so we have done the price increase to 26:19 26 minutes, 19 seconds kind of mitigate that issues coming out of the cost inflation but In parallel as a company, as a manufacturing 26:26 26 minutes, 26 seconds organization, we are embarked into number of initiatives on energy side, raw material side, efficiency side, 26:33 26 minutes, 33 seconds product mix side, rest of all the stuff to ensure that we are able to compensate for the cost increase with some internal efficiencies as well. 26:43 26 minutes, 43 seconds Thank you, sir. 26:44 26 minutes, 44 seconds Thank you. We request participants to restrict themselves to two questions at a time. Please, you may join back the queue for follow-up questions. 26:53 26 minutes, 53 seconds Next question is from the line of Satya Jen from Ambbit Capital. Please go ahead. 26:58 26 minutes, 58 seconds Hi, thank you. So just uh Mr. Juma, just a follow up on the packing packaging part. Um you mentioned that there is 27:08 27 minutes, 8 seconds some conversion where you source granules on your own and then give to packing companies for conversion. Just a 27:15 27 minutes, 15 seconds couple of questions around packaging specifically. So a um what is the inventory that you have for packaging? 27:24 27 minutes, 24 seconds Just trying to understand there too many moving forces um right now in terms of seasonality for packaging that we're 27:32 27 minutes, 32 seconds hearing. So what is the inventory level you're carrying? Just trying to assess the risk of availability of packaging bags. When you source granule on your 27:39 27 minutes, 39 seconds own, is it something higher versus the industry and are you facing any challenges like everybody else in sourcing the granules? Third on this 27:48 27 minutes, 48 seconds packaging specifically that historically when we saw fuel cost inflation in 22 there was a pivot to blending because 27:56 27 minutes, 56 seconds you reduce the share of clinker in the overall mix for the industry. Now you have higher fuel cost inflation but you also have higher packing costs which um 28:05 28 minutes, 5 seconds would naturally mean companies try more um non-trade cement. So where are you um pivoting to um in terms of trade 28:13 28 minutes, 13 seconds non-trade mix this year? So all these are tied to packaging. Then I have another question. I'll come back for um for for balance sheet cash flows and all. 28:24 28 minutes, 24 seconds Okay. uh in terms of the uh bags typically we carry about uh 15 to 20 days of uh bag inventory that the stuff 28:33 28 minutes, 33 seconds and I guess uh uh it is so volatile that the bats currently which I have are at a 28:40 28 minutes, 40 seconds price which was already at 155 rupees per kg granle and I I guess any further increase in price again the back cost is 28:49 28 minutes, 49 seconds going to increase. So when I mentioned the impact of uh uh granule price increase which will come for full month April will be close to about 100 rupees 28:57 28 minutes, 57 seconds per ton. So that's like kind of uh done deal for the month of April. Any further increase in granules will anyway go to 29:05 29 minutes, 5 seconds month of May that can be uh next uh cost impact will further go up in the month of May. As regards the granules and 29:14 29 minutes, 14 seconds conversion models we are I don't know about other companies. So we had adopted this approach for uh more than a year now where we source granules from 29:22 29 minutes, 22 seconds granular manufacturers and then put it on a conversion contract with our bag manufacturers and run. Uh but currently 29:30 29 minutes, 30 seconds since uh the overall granule availability itself is kind of uh so we still get granules from our 29:39 29 minutes, 39 seconds granule manufacturers but also use the granules which the packing suppliers already have. So right now it's a blend 29:46 29 minutes, 46 seconds of uh uh granual supply model as well as outright back purchase model. So that's how we are navigating. We'll continue to 29:55 29 minutes, 55 seconds uh navigate the same way till such time the entire situation gets back to normal. So that's the uh scene on 30:04 30 minutes, 4 seconds packaging. But in terms of impact of packaging into trade segment and non-trade segment or moving from back 30:12 30 minutes, 12 seconds cement to loose cement uh typically uh we are a company which operates at a 30:18 30 minutes, 18 seconds pretty high trade to non-trade uh ratio and also our CK ratio in east is already over 2.1 is the CK ratio which we 30:27 30 minutes, 27 seconds operate in uh east and then north and uh uh the CK ratio is uh little bit uh 30:35 30 minutes, 35 seconds lower because we have more OPC content in north. So overall the company's CK ratio is 1.72. 30:44 30 minutes, 44 seconds It's pretty high per industry standards. 30:47 30 minutes, 47 seconds I don't see the CK ratio going much higher than this kind of number in the short run. So we don't have any programs 30:54 30 minutes, 54 seconds to move from uh CK ratio at current level to any other number to compensate for the various cost increases. 31:04 31 minutes, 4 seconds As regards the movement of uh non-tradient from back cement to a loose cement, certain markets do operate 31:13 31 minutes, 13 seconds at a loose cement model which is typically the Gujarat market. So we would uh and also some parts of 31:20 31 minutes, 20 seconds Chhattisgarh we still would send through loose cement and uh if you ask a question is there a huge thrust to move from bag into loose? Uh not not really. 31:31 31 minutes, 31 seconds uh the one thing which we are really focused on right now is to kind of move away from uh OPC to blended cement more 31:38 31 minutes, 38 seconds and east in the short run so that uh our CK ratio can further increase the energy cost per ton of cement can come down so 31:45 31 minutes, 45 seconds that's the specific agenda I need not again OPC OPC markets we are kind to go a little bit slow but in Gujarat we 31:53 31 minutes, 53 seconds won't be able to do because the market construct it still is that way but rest of the markets like Rajasthan or Hiana our focus is to kind of go away from OPC 32:01 32 minutes, 1 second to get blended cement but that's independent of this uh energy agenda because in the past past calls they had mentioned that our north capacity is 32:10 32 minutes, 10 seconds more or less reaching capacity utilization so if we have to kind of unlock uh cement in north in the short term till bad comes into being we will 32:20 32 minutes, 20 seconds continuously move away from OPC to a blended cement to increase that much more cement available for sale in the market so that's a separate agenda not 32:28 32 minutes, 28 seconds linked to the energy crisis Uh thank you so much for this elaborate answer just to follow up on this. So um 32:36 32 minutes, 36 seconds cost increase on the packing side is well understood. Just on the availability of bag also either granular 32:43 32 minutes, 43 seconds or bag are you foreseeing any challenges where there is shortage and that restricts the ability ability for cement 32:50 32 minutes, 50 seconds manufacturers to manufacture and in that context we heard from some channels that there was specific pockets where no 32:59 32 minutes, 59 seconds actually faced some challenges for very short period in the quarter and that was um overcome through various means maybe 33:06 33 minutes, 6 seconds if you can talk about were there any challenges in the quarter in terms of availability and did that disrupt production at all and how are you uh 33:15 33 minutes, 15 seconds foreseeing the availability and what actions can you take in this because generally there is a fear that there may be some disruption if uh you have lower 33:22 33 minutes, 22 seconds availability of bags I think it's an industry uh phenomena so everybody in industry got impacted due 33:31 33 minutes, 31 seconds to bag nonavailability in the month of March and it continues in April as well so if you look at the east market any 33:38 33 minutes, 38 seconds market for that matter lot of back capacity, bag manufacturing capacity came into force three years ago and 33:46 33 minutes, 46 seconds hence there has been a general capacity utilization reduction in capacity utilization about around COVID time and beyond that I think lots of capacities 33:54 33 minutes, 54 seconds came into being but typically April May is the time when fertilizer movement also happens and also with this Bangladesh issue of Jude backs not 34:03 34 minutes, 3 seconds coming to India there was a general scarcity of backs which started happening from February onwards. So one was of the view that this entire 34:12 34 minutes, 12 seconds fertilizer movement as well as Bangladesh nothing can happen because that is uh right now there's no Jude availability there but however starting 34:20 34 minutes, 20 seconds February itself this issue of overall bag availability and heating up of bag conversion cost happened Jan February 34:28 34 minutes, 28 seconds March this war is a new phenomena which happened additional phenomena which happened in the month of March. So we were of the view that come May once this 34:37 34 minutes, 37 seconds fertilizer moment and all happens the capacity utilization of back manufacturer will come back to normal and we should not be a problem but with 34:44 34 minutes, 44 seconds this issue of granle itself not available then I think that's added a new layer of uh serious challenge not 34:51 34 minutes, 51 seconds even new layer it's a serious challenge availability issue price is a problem I I certainly can talk for no but I think 34:59 34 minutes, 59 seconds because back manufacturers are all common for all the cement manufacturers I guess there is a widespread challenge 35:06 35 minutes, 6 seconds for timely bag availability in certain markets all over India more so in need where capacity utilization of bag 35:14 35 minutes, 14 seconds effects are running to the extent of 90 plus uh percentage. So we did face in the month of March batch and uh s uh the 35:23 35 minutes, 23 seconds number of 6 million we could have done a little bit more in the month of March. 35:26 35 minutes, 26 seconds We had two major disruptions which happened in the March. One was rake availability was a serious problem in the month of March because the 35:33 35 minutes, 33 seconds government decided to divert all rakes for movement of coal to power plants. So typically we would get four and a half 35:41 35 minutes, 41 seconds rakes per day and that came down to four rakes per day. So there was overall clinker moment challenge as well as bag 35:48 35 minutes, 48 seconds availability challenge. In spite of that we hit a historical high of 6 million tons in the quarter. We could have done 35:56 35 minutes, 56 seconds more because we had the we could have served the market. Demand was pretty good for us. Uh but I guess that's what we have to live with. So we have to sail 36:05 36 minutes, 5 seconds through the coming few months with this back shortage. And also that if somebody had asked the next question I was anyway 36:12 36 minutes, 12 seconds uh I had to share the issue of rake availability in the month of March and we as we sit right now we are having 36:20 36 minutes, 20 seconds serious problems of rake availability as well and we have resorted to moving material by road to some of our grinding 36:27 36 minutes, 27 seconds unit because rake is not available sufficiently all rakes are diverted to power plants. So I think this should 36:35 36 minutes, 35 seconds reduce once the monsoon sets but that's still a month and a half two months away. So we will we face problems in bags. We will continue to face problems. 36:43 36 minutes, 43 seconds I guess we'll it's a tight rope walking. 36:46 36 minutes, 46 seconds It's an everyday journey where we kind of find a way to uh source bags incentivize for short-term incentives 36:53 36 minutes, 53 seconds for the bag manufacturers to make. So all net with all the incentive granular cost increase it came to about 100 rupees in the month of March. It is 37:01 37 minutes, 1 second continuing at the similar levels in April. 37:04 37 minutes, 4 seconds Mr. I just ask one quick follow up on I request you to join back the queue please as we have other participants. 37:11 37 minutes, 11 seconds Thank you. 37:13 37 minutes, 13 seconds We'll take our next question from the line of Shraan Sha from Dalat Capital. Please go ahead. 37:22 37 minutes, 22 seconds Hi sir. Yeah. Yeah. Yes please go ahead. 37:27 37 minutes, 27 seconds Yeah. Uh sir uh you mentioned about in terms of reducing the petco share both in east and north. So roughly around 3 37:34 37 minutes, 34 seconds to 5 odd percent. But currently in Q4 what was the petco percentage and the AFR percentage in the 37:43 37 minutes, 43 seconds fuel mix at the company level company level our Q4 number fuel all 37:50 37 minutes, 50 seconds blended fuel was 1.44 44 rupees per million car out of 1.2. 37:59 37 minutes, 59 seconds Yeah. I me I'm answering your question. Yeah sir. Go ahead. 38:06 38 minutes, 6 seconds Uh fuel cost for the company was 1.44. 38:10 38 minutes, 10 seconds Coal came at 1.27. Petco came at uh 1 38:17 38 minutes, 17 seconds 84 and AFR was at.9. That was a number which we had for last year. 38:24 38 minutes, 24 seconds And in terms of the fuel mix percentage share, petco share and AFR share in Q4 was how much? And uh because we were 38:33 38 minutes, 33 seconds looking at even AFR also to increase to 30 to 15%. 38:38 38 minutes, 38 seconds Okay. Our coal percentage as a company was 53% with linkage 31 and non-linkage 21 which is domestic open market coal. 38:48 38 minutes, 48 seconds And then Petco in Q4 was close to 37% and AFR was about 10%. That's the number we had in Q4. 38:56 38 minutes, 56 seconds And this AFR in Q1 can can we see will will further go up to 13 15%. That's what we were looking at. 39:08 39 minutes, 8 seconds uh uh FI27 our target is to get this AFR percentage from as a company from 10% to 39:16 39 minutes, 16 seconds 12 13% is what we will uh look at uh that's the number we are targeting to offset the coal price increase 39:24 39 minutes, 24 seconds and sir in terms of cost further more let's assume by the end of this month and election is over state elections and 39:32 39 minutes, 32 seconds uh if you further can see diesel price going up by 10 odd rupees which the central government has to excise it. Uh 39:41 39 minutes, 41 seconds so how one can look at this 10 rupees let's assume 10 11% kind of a increase 39:47 39 minutes, 47 seconds uh will it be a entire 10% will be the direct increase in the in in the in the 39:55 39 minutes, 55 seconds freight cost or will it be a 60 70% and 30 40% is kind of a fixed that's way one can look at 40:02 40 minutes, 2 seconds no I don't think in this investors call I won't be able to give pricing strategy of the company and what are the minute 40:09 40 minutes, 9 seconds steps how are we going to manage it? So I basically gave a overview because this is a strategy which we will work other companies will work and I would refrain 40:18 40 minutes, 18 seconds from giving what are all the uh detailed steps the company will take in the coming 6 to 8 weeks to manage. I give a 40:24 40 minutes, 24 seconds over overarching picture of reducing petco quantity increasing geomix improving a premium share and moving 40:33 40 minutes, 33 seconds away from mineral gypsum to FGD. These are the big initiatives we will work on. 40:37 40 minutes, 37 seconds But to kind of give a mathematical model, if this goes up, this will be the price. I don't think uh uh I would like 40:45 40 minutes, 45 seconds to share such kind of information in this call. 40:48 40 minutes, 48 seconds Uh yeah, I got it. But just on a broader perspect whatever we have said till now 8 12 rupees kind of a trade hike and 105 40:56 40 minutes, 56 seconds so roughly 10 11 rupees kind of a at a blended level price hike and given the obviously the petco cost will be if it 41:05 41 minutes, 5 seconds stays as it is today maybe July August onwards we will have a hit and let's assume that uh then roughly we are still 41:14 41 minutes, 14 seconds and then the 100 rupees packing cost increase is there so roughly still we are behind And in terms of 10 odd rupees 41:21 41 minutes, 21 seconds and on the price hike 8 10 rupees still I don't think I will be I will be answering this question because I cannot 41:28 41 minutes, 28 seconds uh do a mathematical reconciliation and say that uh this much price increase this much cost increase suddenly I will 41:35 41 minutes, 35 seconds not be able to tell but uh that won't be uh that's not going to be my approach of 41:41 41 minutes, 41 seconds uh uh giving both the details but all I can share with uh you is uh certainly 41:48 41 minutes, 48 seconds the costs have gone up which I shared with you in a transparent manner what has been the impact of bags and what has been the impact of fuel in uh March and 41:58 41 minutes, 58 seconds March is all done now so I guess April what will be the impact of bags on fuel I guess certainly uh the blended cost of 42:06 42 minutes, 6 seconds fuel bags gypsum rest of all the stuff I'm really looking at a cost inflation of close to 200 rupees per ton and hence 42:16 42 minutes, 16 seconds at 200 rupees per ton uh with the kind of price increase net of GST there is 42:23 42 minutes, 23 seconds still going to be some gap but so our effort will be to work on the internal levers plus I guess an appropriate time 42:30 42 minutes, 30 seconds when the the year started I guess quarter ending schemes have ended in the market and I think demand will pick up 42:37 42 minutes, 37 seconds summer is coming with elections finishing and all the labor getting back to major markets from the post election scenario in key states I think high for 42:47 42 minutes, 47 seconds demand opening up to 7 to 8% uh uh going forward. That's when we I plan to catch the pricing trajectory. 42:57 42 minutes, 57 seconds Thank you. 42:59 42 minutes, 59 seconds We'll take our next question from the line of pages Pradhan from CD Group. Please go ahead. 43:06 43 minutes, 6 seconds Yeah. Hi sir. Just on the balance sheet if I look at historical trends for you has been typically a quarter when we 43:13 43 minutes, 13 seconds when we have uh unwind in terms of the debt reduction, right? But uh this quarter if I look at uh net debt it has 43:21 43 minutes, 21 seconds gone up from 42 billion to 44 billion and in addition to that we also had the 43:27 43 minutes, 27 seconds CCD uh issue at the uh Vadrage level right so if I adjust for that then maybe that 3 billion also in addition the debt 43:37 43 minutes, 37 seconds would have uh gone up so any any reason why we had an increase in net debt in the quarter. 43:44 43 minutes, 44 seconds Yeah, let me ask Manish our CFO to address this very Manish. 43:48 43 minutes, 48 seconds Yeah, so basically if you look at uh during the quarter, so first of all, we had this CCD uh which has come in and uh 43:57 43 minutes, 57 seconds we use the proceeds to pay off uh the commercial paper or in terms of the British land that we taken earlier uh to 44:05 44 minutes, 5 seconds for the purpose of this acquisition. So that is there. Besides that uh in terms of if you look at the overall net debt 44:13 44 minutes, 13 seconds for the entire year right so I'll just give you the whole waterfall for that. 44:17 44 minutes, 17 seconds So if you look at that we started the year with a 3,640 crores and overall net debt we have ended with a 4,445 cr. So 44:25 44 minutes, 25 seconds there's a 900 cr increase that has happened and this is primarily because of the varaj acquisition that has happened. So overall investment value 44:34 44 minutes, 34 seconds for the garage if you recall in the previous calls what we have talked about is 1,800 crores and on top of it with there is this 200 crores uh that we had 44:41 44 minutes, 41 seconds uh funded or made the investment for the BJ acquisition. So altogether 2,000 crores of investment has been done and as against that we have a 900 crores of 44:50 44 minutes, 50 seconds CCD that has come in. So there's 1100 crores of internal approvals uh or the borrowing that has gone into funding uh 44:57 44 minutes, 57 seconds the entire acquisition and from the operating cash flow if you look at around 1,80 crores of EIA that has been 45:04 45 minutes, 4 seconds generated uh there is this interest of around 450 cr that has gone in besides that the working capital to fund the 45:11 45 minutes, 11 seconds scale of operations from 19.4 million tons to 20.4 4 million. So there's increase in the working capital besides 45:18 45 minutes, 18 seconds the capeex that has gone in uh across the plants the sustaining capeex the uh normal capeex uh that has gone in uh for 45:28 45 minutes, 28 seconds uh the land mining uh as well as uh the capeex that has gone for the mad stuff. 45:35 45 minutes, 35 seconds So that is how the overall 880 crores of uh operating cash flow has been utilized and then there is income tax payment 45:42 45 minutes, 42 seconds that has gone in this financial year. So altogether if you look at from the operating cash flows there is actually a 300 crores of net debt that has reduced 45:50 45 minutes, 50 seconds right but because of this vash acquisition that has happened. So there is a uh increase that is coming on on the balance sheet side to the extent of 900 crores. 46:00 46 minutes Let me just just Manish finished it. 46:02 46 minutes, 2 seconds Manish thank you for explaining this. Uh we started there with 3640 crores of net debt. We ended the year 46:10 46 minutes, 10 seconds with 44 45 crores of net debt. This 3640 you have to add close to 200 crores of uh uh investments which you have made. 46:19 46 minutes, 19 seconds It would have gone to 5640. 5640 had 900 crores of CCD. So knock off 900 from 5640. So it'll come to 4740. 46:29 46 minutes, 29 seconds Technically speaking we had that we bought something we did CCD. We should 46:36 46 minutes, 36 seconds have ended there with 4740 but we ended the year with 4445. 46:42 46 minutes, 42 seconds put 300 cr reduction in debt on a liketo-like comparison coming out of operational efficiency, prudent capex 46:50 46 minutes, 50 seconds and cash flow generation. So I guess whatever things which I've been talking on every call to kind of find a way to 46:58 46 minutes, 58 seconds restrict capex, reduce working capital, manage cash flows to do a debt reduction and all the time we have been talking 47:05 47 minutes, 5 seconds about when our debt reaches 3500 to 4,000 we will make the next investment. 47:10 47 minutes, 10 seconds So that is how we made the next investment. The next investment took the data. Now the debt ranges at 4445. 47:18 47 minutes, 18 seconds Technically on mathematical terms on a likelike comparison it should have been 4745 but wonderful work done by the teams brought the number to 4445. 47:30 47 minutes, 30 seconds Sure. Uh okay just to uh just to sort of um clarify uh uh the question also uh 47:37 47 minutes, 37 seconds just on a quarteronquarter basis if I look at at least the last four five years uh generally uh 32 end versus 47:45 47 minutes, 45 seconds March uh there has been like a 4 to 5 billion uh quarteron quarter reduction in net debt versus that this quarter 47:53 47 minutes, 53 seconds there is a two uh billion increase. So anything specific in this quarter? I understand the full year. Uh so uh that 48:00 48 minutes explanation I understood uh just on a quarteron quarter anything particular to flag off uh because of which um the debt increased. 48:09 48 minutes, 9 seconds Our uh net debt uh December stood at 4817 and against that 4817 we are at 4445. 48:20 48 minutes, 20 seconds So there again I think there is a so so the point that you're making is the net debt has gone down slightly 48:28 48 minutes, 28 seconds higher this time accord previous year. 48:32 48 minutes, 32 seconds Uh okay so my number was 4,217 cr. I mean correct me if I'm wrong. Uh that's not the right number. The number is 4,817. 48:43 48 minutes, 43 seconds Okay understood. So I'll take it offline. No not an issue. Um uh just on the other uh data question that I had uh 48:50 48 minutes, 50 seconds was the clinker production in full year FI26 and the lead distance for the fourth quarter just these two 48:59 48 minutes, 59 seconds we don't clock clinker production uh only company we we report uh cement 49:08 49 minutes, 8 seconds production as regards the lead distance reduction uh Q4 to Q3 no substantial 49:15 49 minutes, 15 seconds reduction lead distance we are at 325 just about a kilometer less 325 49:22 49 minutes, 22 seconds uh cm largely coming due to our as I explained little while ago to saty's question uh we had we had challenges in 49:31 49 minutes, 31 seconds clinker moment so we had to kind of do little bit of tradeoff of how can I move clinker to the right places because rake availability was not there everywhere 49:40 49 minutes, 40 seconds and second also is the fact that uh uh we had to What do you call uh packing bag was also 49:48 49 minutes, 48 seconds challenge in certain places and like do not do lot factories which was different it was different so we couldn't do too much of impact on the lead distance 49:55 49 minutes, 55 seconds reduction which it remained at 325 sure thanks that's all thank you next question is from the line 50:04 50 minutes, 4 seconds of goel from UTI AMC please go ahead um hi thank you for the opportunity just 50:11 50 minutes, 11 seconds uh one quick question so if you could um give the debt and can you speak on the handset please? You're very very feeble. 50:20 50 minutes, 20 seconds Yeah. Uh am I audible? Yeah, at this level you're audible. 50:24 50 minutes, 24 seconds Yeah. Uh thank you. So uh just one quick question. If you could give a guidance on the debt and capex for FI27. 50:33 50 minutes, 33 seconds Okay. So on the uh capex I would give a guidance. So every quarter we've been talking about uh capex. So in FI 26 uh 50:43 50 minutes, 43 seconds the year gone by I had given a outlook of 700 crores for capex we ended with 712 crores a small 10 crore increase so 50:52 50 minutes, 52 seconds more or less uh exactly the same way which we planned for the year uh 27 and 28 will be 900 crores for 27 and 960 51:01 51 minutes, 1 second crores for 28 that's all largely coming out of uh VRA refurbishment 627 and 728 51:10 51 minutes, 10 seconds overall next two years 900 crores in FI27 960 crores in FI28. As regards the 51:18 51 minutes, 18 seconds debt level number I guess there is going to be a period of few quarters where this debt is going to be around this number because we have borrowed and 51:27 51 minutes, 27 seconds invested in Madra. However, our goal has been to maintain that uh debt level to two to two and a half times uh epida and 51:36 51 minutes, 36 seconds there we will meet our numbers during the fiscal fi 28 27. All right. Thank you so much. 51:45 51 minutes, 45 seconds Thank you. Next question is from the line of Girija Ray from Nal Bank. Please go ahead. 51:53 51 minutes, 53 seconds Hi, thanks for taking my question. Uh so uh one confusion like know uh if I go 52:00 52 minutes back to 2020 to September you know postcoid again uh you know uh there was 52:07 52 minutes, 7 seconds a a spike in petco even though uh after covid uh you know the market opens and 52:14 52 minutes, 14 seconds everything the infra also started booming uh so we were not able the industry was you know struggling to pass in this uh input cost to the consumers. 52:25 52 minutes, 25 seconds Uh so in this uh normal course of situation when you know India is doing well and you know the things are getting 52:34 52 minutes, 34 seconds uh you know in a good phase uh so seeing this uh cost increase like you know petco prices and packaging cost. So what 52:44 52 minutes, 44 seconds how do you see this uh the the kind of price hike will take which can be passed on to the you know consumers post GST 52:53 52 minutes, 53 seconds red cut even you know if I remember post G know the GST red cut had given a 52:59 52 minutes, 59 seconds headroom for 35 to 37 rupees for backup increase. So so far we have increased around 10 to 12 rupees on a blended 53:07 53 minutes, 7 seconds basis. So but you know even in September 22 uh you know most of the pockets they have taken a price like of 50 to 70 53:15 53 minutes, 15 seconds rupees still it was not adequate enough to pass on uh to the uh consumer the profitability was impacting that time. 53:23 53 minutes, 23 seconds So how do you see this can be what kind of price hike we can take and how this is will be feasible to pass into the consumers. 53:33 53 minutes, 33 seconds uh when you look at uh 4 year window so I guess I'll little bit uh jog from my memory and uh talk about 53:42 53 minutes, 42 seconds September 22 it's pretty far away but all I can say is at the time petco was uh trending nearly close to about uh uh 53:51 53 minutes, 51 seconds $250 per ton and then the rupees per million cal was also pretty high at that time it took a good uh 6 to 8 months for 53:59 53 minutes, 59 seconds the prices to taper down uh but this time around if you see uh petco is uh 54:07 54 minutes, 7 seconds current trending at 2.04 rupees per million cal and uh at this kind of levels uh the price hike which we have 54:16 54 minutes, 16 seconds taken just about meets the cost inflation. So whatever currently we have taken is just about meets the current 54:23 54 minutes, 23 seconds kind of price cost inflation which has happened. So it's kind of a neutral ground as we speak. But any further 54:31 54 minutes, 31 seconds increase in cost I guess we will go for additional price increase. I will not be able to comment right now whether it 54:38 54 minutes, 38 seconds will be 10 rupees per bag or 15 rupees per bag. God forbid the cost doesn't go so much. So we'll be mindful as a 54:45 54 minutes, 45 seconds responsible company but certainly I think uh eventually when the overall uh cost lines go up I think it'll have an impact on the overall economy of the 54:54 54 minutes, 54 seconds country. So we will go by uh as the situation unfolds. Uh what is in our 55:01 55 minutes, 1 second control is to tweak the fuel mixture, tweak the model mix, tweak the geomics, bring about efficiencies and that's 55:10 55 minutes, 10 seconds where our immediate focus entire team is working on to squeeze out some of the money so that the cost increase can be 55:16 55 minutes, 16 seconds obiated by the efficiency improvement within the company. Beyond that we will have to take a price increase. I hope 55:24 55 minutes, 24 seconds there's a situation doesn't happen there where we have to take big time increases but I don't rule out any uh situation where we will not take price increase. I 55:32 55 minutes, 32 seconds won't say we will take but certainly I will give her a different different way will answer your question. I'm not ruling out any price increase going forward. 55:41 55 minutes, 41 seconds Okay. Okay. My last question will be uh you know there is some uh you know kind of uh decline from past three quarters. 55:48 55 minutes, 48 seconds I can see the employee cost per ton has declined. So that is one and second one is uh you know related to our capacity 55:55 55 minutes, 55 seconds utilization which is very good to see that we have reached a very significant capacity utilization in fourth quarter. 56:02 56 minutes, 2 seconds So is there anything like uh uh we are trying to capture the market or gain the market share breaking the pricing power 56:10 56 minutes, 10 seconds these two question this will be my last question certainly I think we will not drop price to increase market share so I think our 56:17 56 minutes, 17 seconds focus is profitability no we'll have to find as a company we do a good balancing act between ensuring profitability and 56:26 56 minutes, 26 seconds also get growth so we will not kind of buy growth by throwing money so that's not in the DNA of the organization We will work very hard to uh get the 56:35 56 minutes, 35 seconds profitability right but certainly I think we'll run behind growth but certainly not through money to create growth that's the DNA of the organization which that is how we have 56:43 56 minutes, 43 seconds been running our company for last many years and that's the way we look at things going forward as regards the overall employee benefits per ton I 56:52 56 minutes, 52 seconds guess scale also comes to picture uh if you see our overall uh absolute volume 56:59 56 minutes, 59 seconds growth in FI 24 and 25 was 18.8 and 19.4. Two years we were stuck at 18.8 and other year we went only to 19.4. 57:08 57 minutes, 8 seconds This was the year where I think the market also improved. We also kind of uh improved to uh what do you call uh 20.4. That's 57:16 57 minutes, 16 seconds where I guess the volume scale benefit also comes to use comes to our cost per turn uh impact. 57:25 57 minutes, 25 seconds Thank you sir. All the best. Thank you sir. 57:28 57 minutes, 28 seconds Thank you. We'll take our next question from the line of Pakin from HSBC. Please go ahead. Uh thank you very much. So my first 57:36 57 minutes, 36 seconds question is related to demand. Uh so in your view what was the industry growth in F26? Uh and given in April there has 57:44 57 minutes, 44 seconds been so much disruption that we are hearing about. Uh how is demand trending in April? Is it flat or has it started declining on a year basis? 57:55 57 minutes, 55 seconds If you're looking at what's the demand has been I guess if you really recall 58:02 58 minutes, 2 seconds our quarter two I think we did not have uh aggressive volume growth whereas quarter three and quarter four I guess 58:09 58 minutes, 9 seconds we uh did grow industry we are looking at a volume growth in FI 26 was 25 anywhere between 6 to 9%. So that's uh 58:18 58 minutes, 18 seconds the outlook for the last last year. I think that's that's my read of how the overall market but again India is north 58:25 58 minutes, 25 seconds south east west central so various markets have got uh uh various growth rates at an allIndia level industry has grown by 6 to 9%. But certain markets 58:35 58 minutes, 35 seconds like uh east or uh even Gujarat for many months during the year or Maharashtra for many months during the year growth 58:42 58 minutes, 42 seconds was steeped less than the national average. uh but however as in our opening speech we mentioned about the infrastructure improvement and the 58:50 58 minutes, 50 seconds investment government is going to make I'm still looking positive for this industry to grow anywhere between 7 to 9% in the coming year as well 59:00 59 minutes um sure sir and you know related to that how is demand shaped up in April so far given uh whatever disruptions we have seen 59:08 59 minutes, 8 seconds okay uh first week anyway April typically first week is al always uh challenging ing week with the uh March 59:17 59 minutes, 17 seconds annual targets for all the dealers across the staff. But uh as we speak I can overall I can basically said there 59:24 59 minutes, 24 seconds is uh uh there are few markets where uh we don't operate all over India but certainly in the markets where we operate northeast uh uh and west and 59:33 59 minutes, 33 seconds some parts of central I think there are pockets in India currently where there are demand is slightly weak. So I'm not going to kind of list on which states 59:41 59 minutes, 41 seconds their demand is weak but in our core states of uh Bihar, Bengal, Jagar, Chhattisgarh there is good demand and uh 59:50 59 minutes, 50 seconds in terms of the first 13 14 days of the month our proa is as per our plan 59:57 59 minutes, 57 seconds and lastly very quickly you said uh Pinakin your voice is muffled. Uh can you repeat your question please? Yeah. 1:00:05 1 hour, 5 seconds So for FI27 you mentioned demand growth at industry level of 7 to 9%. Uh so at a 1:00:11 1 hour, 11 seconds novocco level I mean it's very early days but what is the target that you are working with? Do you because FI26 was 1:00:19 1 hour, 19 seconds 5%. So should we see a pick up in dem sales in F27? 1:00:26 1 hour, 26 seconds No. Uh you want what I tell my employees you want what is likely to happen. So certainly I think we will we will 1:00:33 1 hour, 33 seconds certainly want to grow in line with industry of 7 to 9% for sure in the market. Uh but uh practically if you see 1:00:41 1 hour, 41 seconds uh markets in north we are kind of operating at 95% capacity utilization. 1:00:46 1 hour, 46 seconds So there I think once our vadras comes in there is going to be few months in the coming year where we will be short of cement and north but that's a popping 1:00:55 1 hour, 55 seconds phenomena that's part of the stuff uh but I still I have adequate capacity in east I still have more cement available 1:01:03 1 hour, 1 minute, 3 seconds in east so I will we are targeting uh to grow anywhere between 7 to 9% uh in line with industry in the coming year as well. 1:01:11 1 hour, 1 minute, 11 seconds Got it. Thank you very much. Thank you. 1:01:16 1 hour, 1 minute, 16 seconds Ladies and gentlemen, we'll take that as the last question for today. I now hand the conference over to Mr. Vishnu Sharma for closing comments. Over to you, sir. 1:01:25 1 hour, 1 minute, 25 seconds Uh thank you. Uh thank you everyone for the question and engagement today. We trust the question discussions have been both informative and useful. Uh the IR 1:01:34 1 hour, 1 minute, 34 seconds team remains available for any follow-up clarification you may need after the call. As we close, uh let me leave you 1:01:40 1 hour, 1 minute, 40 seconds with a few thoughts on where stands and where we are headed. Our growth agenda is firmly on track. The Vas project is 1:01:49 1 hour, 1 minute, 49 seconds progressing as planned with phased commissioning beginning Q3 of 27, further strengthening our presence across the western and northern markets. 1:01:59 1 hour, 1 minute, 59 seconds Beyond capacity, our strategic priorities remain clear and consistent. 1:02:04 1 hour, 2 minutes, 4 seconds Premarization, geographic optimization and cost discipline. These are not just aspirations as they are disciplines we 1:02:12 1 hour, 2 minutes, 12 seconds have demonstrated quarter after quarter and they will continue to drive long-term shareholder value creation. 1:02:18 1 hour, 2 minutes, 18 seconds Thank you for your continuous support and trust. We look forward to speaking to you again next quarter. Thank you very much. 1:02:26 1 hour, 2 minutes, 26 seconds Thank you on behalf of Novokco Vistas Corporation Limited. That concludes this conference. Thank you for joining us and you may now disconnect your lines.