JSW Cement Limited (JSWCEMENT) Q1 2027 Earnings Call Transcript

Ladies and gentlemen, good day and welcome to JSW Simmons' earnings call for the quarter ended 30th June 2026, hosted by Philip Capital. 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 the conference call, please signal an operator by pressing star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Webb of Agarwal from Philip Capital, India Private Limited. Thank you. And over to you, Mr. Agarwal.

Thank you, Ranju. Good morning, everyone. On behalf of Philip Capital, India Private Limited, we welcome you to the Q1 FY27 call of JSW Cement Limited. On the call from JSW Cement, we have with us Mr. Nilesh Narvekar, Chief Executive Officer, Mr. Narendra Singh Thailon, Director of Finance and Commercial and Chief Financial Officer, Mr. Hitindra Garibala, Chief Marketing Officer, and Mr. Kunal Mukherjee, Head Investor Relations. I would like to mention on behalf of JSW Cement Limited and its management that certain statements that we've made or discussed on this conference call may be forward-looking statements based on current management expectations and also something that relates to future expected business development by JSW Cement's management. Such statements are subject to a number of risks, uncertainties, and other important factors which may cause the actual developments and results to differ materially from any management projections made on this call. JSW Cement Ltd. and the management of the company assumes no obligation to publicly update or alter these forward-looking statements, whether as a result of any new business development information or future event or otherwise. Also, participants on the call can download a copy of JSW Cement's Q1 F527 results presentation from the company website of Stock Exchanges. I will now hand out the floor to the management of JSW Cement for the opening remarks which will be followed by the Q&A. Thank you and welcome, sir.

Thank you, Vaibhav. Good morning to all, and we welcome you to the quarter one FI27 earnings call of JSW Cement. I hope all of you have had the chance to review our results and investor presentation. With this, I will hand over the call to Mr. Nilesh Nathwekar for his opening remarks. Over to you, sir.

Thank you, Kunal, and good morning to all. FY27 has started off on a strong note for the company, despite the ongoing uncertainty around the West Asia crisis and the impact of state elections held early in the quarter. As per our reading, cement demand in south, west, and east regions grew approximately 6% YOY in quarter one FY27. The north region, where we started sales in this quarter, saw substantially higher demand growth of approximately 11% YOY. Government CAPEX did much of the heavy lifting in the quarter. Central CAPEX grew by 24% YOY, and data indicates that 28% of the FI27 CAPEX budget has already been utilized in quarter one. Similarly, state capex and infra-construction goods output continue to grow by a while. We are seeing very strong demand outlook on the infra and large projects side for the rest of the year, which will support our non-trade cement and the GGPS business. Just to give a few examples of large projects in our regions, In MMR, we see pace picking up in the bullet train project, the Maharashtra packages, and the Western Coastal Road project at Mumbai will also gather pace. Post-monsoons, road-related works are expected to pick up speed, too. In Pune, we would like to highlight the Pune Ring Road project and various new elevated road packages. There are also a few new metro projects planned in Pune. In South Region, Amravati New Capital Development Project at AP is gaining speed. The NPCIL-NUK power plant expansion in North Karnataka and several large road packages in Chennai and Kerala are expected to generate substantial demand. On the residential front, we are seeing strong residential activity in Pune, Hyderabad and Bangalore, and most of you will be aware of the substantial residential redevelopment happening in Mumbai and the suburbs. Finally, on the macro front, we continue to monitor the external environment, which remains volatile. As fuel prices may elevate, we are increasing our share of domestic fuel for the rest of the year. Moving to the key operational highlights for Quarter One FI27, firstly on volumes. Our total sales volume in Quarter One FI27 increased by 15% YOY to 3.81%. Taking this product-wise, cement volume sold was 2.34 million tons, increased 27% YOY. For ease of comparison, if we exclude the North operations, the volume increase was 8% YOY. As we had flagged in our quarter four call, demand in April and early parts of May was affected due to labor migration and state elections, but we saw a strong rebound in the month of June. We'd also like to touch upon the contribution from the north region. The market reception has been very positive so far, with an average utilization level of 55% in quarter one. The utilization rate touched almost 68% in June 26. GGBS volume growth was relatively muted at 2.6% worldwide. However, we are optimistic on the prospects for GGBS for the rest of the year. We have received approvals for over 29 large infra projects in Q1, and moreover, the project pipeline is also robust, as mentioned earlier. Moving to product ASP, cement realization for Q1 Fi27 was Rs. 4,951 per ton, increase of 6% QoQ, with the highest increase in East Region, followed by South and West. GGPS realization in Q1 Fi27 was Rs. 3,807 per ton, increase of 3.4% Q1. Within cement, trade mix remains stable at 51%. Our clinker to cement factor increased to 55% with the launch of North Operations, but remains one of the lowest in the industry. Lead distance remains stable in the quarter. I would also like to briefly touch on the capacity expansion program. Substantial progress has been made on installation of the waste heat recovery system, the OLBC, and the AFR co-processing system at the NAGOR integrated unit, and these are expected to commission the next few weeks, which is going to bring down our costs significantly. The additional 1 million tonne grinding capacity in Nagora is also on track and is expected to be commissioned by end of Q2. We added 56 megawatt of wind capacity in Q1 at Dorvi and Vijayanagara, and this took our RE share to 30% of Q1. Let me now hand over to Narendra to take you through the key financial highlights.

Thank you, Narendra. Good morning to all. I will summarize the performance of Q127. At company level, consolidated revenue was 1,896 crores. That's an increase of 22% year-on-year and flat quarter-on-quarter. Consolidated operating EBITDA was 299 crores. That's lower by 7.5% year-on-year. Despite improvement in realizations, EBITDA declined mainly due to cost pressures in fuel and packing, plus the substantial marketing investment of about 33 crores made in North Region during quarter 1. Consolidated operating EBITDA per ton was 784 rupees a ton for the quarter. As already mentioned, we started sales in the north region, and this quarter was the first full quarter for us. Excluding the north operations, revenue grew by aprox 10% in quarter, while operating EBITDA increased by 4% to 336 crores. That's 979 rupees a ton. Total EBITDA, including other income, was 372 crores. PBT was 190 crores during the quarter, including positive contribution of about 13 crores from the Fujaira operations. Pat for the quarter was 153 crores. In terms of the trend in mean cost elements in Q1, raw material and power and fuel increased on quarter-on-quarter basis, primarily due to higher fuel cost and impact of Nagar operations. Blended fuel cost for the quarter increased to 1.80 paisa per MCAL versus 1.49 paisa per MCAL in the previous quarter. We are working towards increasing our share of domestic fuel to optimize our costs in the coming quarters. Logistic costs per ton reduced by 2% quarter on quarter with a slight reduction in lead of 4 kilometers as well as some efficiency measures. Other expenses have also increased by 4.5% quarter on quarter in absolute terms. And this is largely related to the heavy marketing investment in the north region and higher packing costs during the quarter. In terms of balance sheet, net debt was 3,856 crores at the end of June. Net debt to EBITDA stood at 2.95 times. Average cost of debt for the quarter was stable quarter-on-quarter at 7.63%. During the quarter, the company incurred CAPEX of 337th Road. We will now be happy to address your questions. Thank you.

Thank you. We will now begin the question and answer session. Anyone who wishes to ask a question may press star and 1 on a 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, we will wait for a moment while the question gives us a message.

The first question comes from the line of Pati Kumar with Jeffries.

Please go ahead.

Hello. Yeah, good morning. My first question is on the or not operating loss of 40 crores in this quarter, including, you said, 33 crore marketing investments. Can you discuss what kind of marketing investments are these? Also, is this 40 crore loss in line with what you expected maybe last year during IPO? And what kind of full year EBITDA you can expect from North operation in first year?

Yeah, hi, Priti. So this expenditure in terms of marketing of 33 crores was primarily around the new campaign launch, which was undertaken on the back of the launch in the north, which was launched, and that was one. And of course, there were a lot of activation activities which were done on the ground level, like there was a Kale Mouth I've done, where we connected with all the 10,000 villages, 10,000 teams participated in the cricket tournament in Rajasthan, similarly with Dangal in Haryana, plus all the activation work at the ground level. So it's a combined effect of all of this, which is contributing towards the 30 crore of marketing expenditure. And as compared to the BP, it was planned in our BP, and we are tracking ourselves against that.

Yeah, and what kind of performance are you looking for for or not? Is it going to turn profitable?

Yes, we should be. I mean, as we had mentioned, in the first quarter, I think we were close to 55% of capacity utilization, and we are holding ourselves to that. In fact, we should be closer to 60% plus by the end of the year in terms of north operations. And the real kicker for us that's going to happen now in terms of costs is once the clinker costs start to come down with the commencement of the OLBC, the alternate fuel, the waste heat recoveries kicking in, the move from imported coal to lignite. But I was talking about how our costs are likely to come down, specifically the clinker costs are likely to come down in quarter two, with the implementation of the overland belt conveyor, the alternate fuel handling systems, the waste heat recovery, which has already been commissioned, it's going to get fully in flow, and of course the rotation towards more of domestic coal and increase in Ignite in our operations. So, all that is being planned for quarter two, and we expect the benefits to start to kick in thereafter.

Thanks. My other question is on GGBS. The growth has been far slower in this quarter. You said we've got significant contracts in like one Q later part. What kind of growth is it you're looking at in the segment going forward? Sure.

So, first, see, in Q1, F527, the demand was affected by a number of topical reasons. Let me explain that. There were RMC closures in the West, there were aggregate availability issues in the South, and the low OPC cash mix cost was a combination of these effects. Now, guidance for Quarter 2 FY27. Despite Q2 being a monsoon season, we are expecting it to be better than Q1, and signs are visible already in the month of July. Now, as I had already mentioned in the opening remarks, we have received approvals for over 29 large infra projects in Quarter 1. Moreover, the project pipeline is also fairly robust, and we are also applying for additional approvals across the central bodies. And we expect the EBS to be, again, in the high single-budgets in terms of growth for the years.

Sure. Thank you, sir. These are my questions. Thank you, Rupi.

Thank you. Reminder to all the participants, that you may have a star and one to ask a question. Next question comes from the line of Rashi with Siti. Please go ahead.

Continuing the question on the north. So, I think the marketing spend was about 33 crores in this quarter. I remember I was about 23 crores in the prior quarter. What are you expecting in terms of the marketing spend going forward as a 2Q, 3Q? That's one. And second is on the overall cement produce, 8% was the X not growth for this quarter. So, how are you expecting to do overall growth forward?

So, the marketing spend in last quarter was, I think, 17 floors. So, the investments in terms of marketing have already been done, and we expect to be able to do that in the following quarters. What is the second part of the question, Rashi? Sorry, I missed that.

The overall, so the X-NOS volume growth, as you mentioned, was about 8% for cement. So, how are you seeing that track for the rest of the year?

How do you, okay, how does that track for the rest of the year? Okay, so, I mean, the industry growth that you, I think you're already aware, excluding north, we're talking about the industry growth at 6%, and we've done, excluding north, we've done it at 8%. Now, what we've seen is in the east and the west, we've done significantly better than the industry. And in the south is where we had a pit of a headwind. Now, that is behind us, and again, finally because of topical reasons. And overall, in terms of our growth, at a company level, we expect to deliver high team growth at an overall company basis, if I was to include north also as a part of this.

Got it. And just on realisation, what is the pricing strategy in the market? So, obviously, it's not very well on realisation. So, how are you, you needed to sort of take the market or how are you?

This is specifically for cement or GGPA? So you're asking over, because both of them are very different approaches, but if we answer two, both of them are different. Yeah, sure. So on cement, there are concerted efforts which is being made. So all the investments that we're doing primarily in terms of building up our brand, the ground connect with the decision-making influencers, the ground connect with the network, all of that is fundamentally playing out for us in terms of being able to increase our price or reduce the price gap that can be A category band itself. So that's one which is playing out. And the second thing, of course, is there is an effort which is constantly on to try and keep reducing our, what do you call, the discount structures as well, which again, it's the realization number. These are two aspects which are working out on the cement side. And on the GDPR side, I mean, the number that you see is primarily a dispersion effect. There will be no change in our pricing strategy overall. We continue to maintain our stamps, and basically the geographic mix is what is reflecting in the numbers that you've actually seen. Thank you.

Thank you. Please, Bastar, I want to ask a question. Next question comes from the line of Shravan Shah with Dollad Capital.

Hi, sir. A couple of things to get an understanding. So, for cement, we said that we are looking at a high teens growth, including north. Sir, just wanted to get a clarity. You said that we are looking at on the cement front, high teens volume growth for FI 27, including north.

Yes.

So, I was just doing a math. Let's say for FI 26, we have done 7.73 on the cement front. If I just take a 18% growth, it comes 9.12 million. And for North, if we take a 60% utilization, which is 1.5 million tons. So, if I minus that, then it comes a 7.62. That means we are looking at a degrowth on the core front, excluding the North. So, just wanted to get more clarity on that.

Yeah, Shavan, I mean, what we've given you is an overall guidance, including North and GGBS, we will deliver a high team growth on an overall company basis. So, that's what we hold ourselves to. And, I mean, while we've done the math, we've also done ours. So, I think, let's stick to the high team growth on the overall company basis as the guidance from our side.

Okay, just wanted to get up because on the GGBS, we are seeing a high single digit growth. So, and then we are seeing on the overall heightings. So, that means on the cement front, including not, it has to be a 25-30% kind of a growth that we should be looking at. So, that's where I have some clarification wanted.

Okay. Can we take this offline? We can connect with Kunal Mukherjee on this.

No issues.

Mr. Shah, please, Vijayan Diki, for more questions. Please press star on 1 to ask more questions. The next question comes from the line of Sanjeev Kumar Singh with Motilal Oswal, Financial Services Limited. Please go back.

Thank you for the opportunity. My first question is on the profitability of North Plant. So can you give some sense on the profitability difference between north and south lands for cement? So why I am asking this is because some sort of marketing expense will not be one-off in nature. It will continue over the next few quarters or few years also when you continue the operation. So that's why I wanted to understand some – I want to get some sense on the profitability difference between north and south lands, which you are seeing as of now.

Yeah, so we all know that north and south are completely different when it comes to profitability. And I'm sure you all have the north performance data available for the competition. Now, for us, it's early days. By the end of September, or I would say in September is when we take even. And then we go in the positive territory. March is the month probably when we can be with more conviction tell you that what is going to be the profitability for the coming month. South is subdued. We saw the results for South companies. South is a bit subdued at the moment. But there is a big difference. The difference can be in the range of probably 600 to 700 rupees a ton.

Okay. And second question is in terms of CapEx plans over the next 2-3 years. So, when do we want to start the central easel plant, and what is the ideal net debt to EBITDA, which we would like to maintain by 2829?

See, for this year, this financial year, we are going to spend about 2,300 odd crores, and about 2,000 in the next year. See, as we had indicated earlier, our intention is to move from 24.1 million currently capacity to about 43.5 over the next few years. Now, that requires about 7,500, 7,600 crore KPEX. So, we continue on that journey, but yes, this year, 2,300 or next year, 2,000, and the following year, probably some of the balance numbers would be spent. Answering your question on the central, central also is on our priority list. We hope to make some announcement in the coming quarters.

And are you net debt to a bidder, sir?

So, the external guidance for us from the board is to keep it below 3, and always the endeavor will be to keep it below 3.

Okay, sir. Thank you.

Thank you. Please, let's start on 1 to ask a question. Next question comes from the line of Naveen Sahadev with ICICI Securities. Please go ahead.

Yeah, good morning, sir, and congratulations on the much faster volume ramp-up in the north region. I had two questions. One is on the RMC business, like you could talk more about the outlook of this particular business, given it is so integral to the cement as well as the GGBS that we offer. So how are we looking at how many plants do we have? What is the vision there? Are we planning to enter in the north region as well with this or in other regions? That would be my first question.

We are, in terms of RMC plans, currently we've got 15. We plan to take it up to 35. We're adding 35 more. And our current approach towards the RMC business has largely been, it needs to be symbolic with the relation to wherever we have our footprint. So wherever we can supply our cement and our cementation in terms of GGPS, that's where we set up the RMC plans. And in the RMC setup, it's largely either commercial, dedicated, or captive. Captive is largely for JSW users. That's how it gets divided. And in terms of, what is the next part of the question? Yeah, in terms of revenue, for quarter one, we were around 100 in terms of RMC revenues. And we have plans to go ahead.

Yeah, thank you.

Thank you. We already started operations in the north as well, because as I said, it's sympathetic to our cement operation.

15 RMC units, is it safe to assume that most of these are currently in the west and south region, which are close to our GGB sourcing units?

Yes, it's safe to assume. In the 15, there are two units in the north as well.

And incrementally, when you say the target is 30, 35, would it be again in west region only, or they would be now more in the north and other regions that we are planning?

No, it is scattered across. So, for example, I mentioned to you, our commercial and dedicated operations are primarily mirroring wherever we have synergies or symbiotic arrangements with us.

My second question was about the long-term capacity expansion plans, and I thank you for including a vision there in terms of scaling the capacity to 68 million tons. My question was, if you have any milestones, you know, benchmark to these expansions, because we are talking about, like, you know, a couple of lines in north, additional lines, I'm saying, in north and in central, Also, some new sites altogether in the Northeast region. So, my question was, if there are milestones, if you can talk about, and within the various locations that you have mentioned, are there any priorities or a priority pipeline that, let's say, for example, Northeast would supersede or come up earlier than the line 2 in North or Central? That kind of a clarification will...

So, Naveen, we are evaluating all the options. Between a central and a northeast and north expansion. We understand all three acquired importance. All three are on the priority list for us. But we will sequence them maybe in a couple of months. We will be in a better position to take that decision. But here, the plans, the long-term plans are, they finish off with the 43 million first, and then go for the balance 25, maybe in the next 3-4 years, following the completion of 43 million.

Understood. Thank you, sir.

Thank you.

Thank you. Please press Dharan 1 to ask a question. Next question comes from the line of Amit Murarka with Access Capital. Please go ahead.

Yeah. Hi. Good morning, and thanks for the opportunity. So, on North Operations, just wanted to check if you are booking incentive in Q1. So, could you confirm that one? No, it's not booked yet. And, like, by when do you expect or what is stopping you from booking it?

No. So, as a process, we have submitted the document. We are awaiting the eligibility certificate, which should be there very soon. The file has already moved a couple of levels. And once we have that, we will start recognizing the incentive. So, we expect this to come within maybe two months, max.

And it's 50 crore per annum, right? I mean, in the first five years. So, did you get the approval?

No. So, the major thing is 23% capital subsidy on the eligible capital investment. So, that and plus something, something will add up to about 50 odd crores, which we can receive over 10 years.

It's not annual. It's not annual. No, not annual. I said 50 crore per annum for five years and then 65 crore for next five years is what I had in mind from the earlier discussions.

No, it's 50 for first four years, then 65, and then 80.

Yeah, right. So 50 for first four years. So that's what I'm asking. Will you book the 50 for the, I mean, in let's say Q3 itself, if you get the approval, or will it have to start from Q3 then?

No, so when it is about the first 50, this is linked to how much of the KPEX I completed. Whatever gets capitalized is what I can, with conviction, say is done. So wait for another this quarter, because we are finishing with the WAC, the RMC, the OLBC, the AFR, etc. And once that's capitalized, probably I can answer this much better, whether 50 or something less would be recognized in the current year.

Sure. And on GGBS, the slower growth, just wanted to understand, like you said, that pricing strategy has not changed, that you are not raising pricing, basically. But also, you said that the central CAPEX was strong in the quarter. So, I'm just getting a bit confused. If pricing was not raised and CAPEX was strong, then why was the volume peak?

See, as I mentioned, there were a lot of RMC closures in the West because of all the challenges there. Aggregate availability issues in the South, and the OPC flash mix costs were also becoming, as you say, unviolent. So they both kind of did it. And because of elections, there was a lot of labor migration from the geography that we operated. So in terms of GDPR sales, I mean, there's a significant volume that we get from the south as compared to, I think, the 60-40 spread between south and west. And hence, the numbers were muted overall. And the growth that we received was primarily in the west. South will impact it, and all that has been corrected for now, and we can always start to see the numbers stack up for the guidance that I had given earlier on this.

Sure, understood. And last question, if I may. So, fuel cost rose very sharply in the quarter. What would be your expectation for the second quarter now, compared to the medium term?

So, we are switching to domestic coal. In fact, we have already started buying domestic coal. And we don't see any escalation beyond the numbers that we achieved in Q1. In fact, in the coming quarters, we expect the second quarter will be almost same as the first quarter. But going into the third quarter, we expect the cost to come down for us.

And just a very last question. On the cost savings program, you had earlier guided for a number. Where are you in that journey and how much is left?

I think every quarter, it becomes a bit difficult to quantify. I guess every two quarters, it would make sense. We did guide the street in May itself, where we are. Yeah. So, hold on for the next quarter's numbers. Probably we can give you a better guidance on this. Yes, we are making substantial progress on the renewable power. And once the entire thing is up and running in September, probably we'll have our answers to that.

Got it. Thanks a lot. And best wishes. Thank you.

Thank you. Please press star and want to ask a question. Next question comes from the line of Siddharth Mehrotra with Codex Securities. Please go ahead.

Thank you for the opportunity.

Sir, you mentioned that we expect to grow somewhere in the high single digits for the GGBS segment. Now, if I recall, we had earlier guided that we expect to grow in perhaps mid-teens in this segment. So perhaps is this a change in our overall outlook for GGPS to a slightly lower level?

Yeah, see, the Q1 was impacted because of what I explained to you earlier. And with Q2, Q3, and Q4 stacking up favorably, yes, the revise would be what I shared with you, which is the high single digits for GGPS.

And in, say, FY28, FY29, do we expect similar numbers, or do we expect to go back to double-digit guidance?

Honestly, it's strongly correlated with the CapEx spend and the infra growth, and that continues to significantly be there. And I think the investment that we've currently made in this specific in Quota 1 in terms of getting approvals and getting these large infra projects all listed and registered, I, at least personally, as a company, we see a very positive outlook going forward, which will play out not only in this year, which is FY27, also in FY28 onwards.

Understood, sir.

So, secondly, we just highlighted that we expect to end the year with around 60% capacity utilization in our Rajasthan plant. So, just wanted to understand, even 1Q exit, our capacity utilization is more than 60-65% as per our PPT. So, why the subdued sort of expectations for full-year utilization?

No, it's not subdued. See, today we are operating 2.5 million capacity, and another 1 million is going to come up in September and early October. So, then we are looking at 3.5 million capacity. So, this number, 60% plus, though, yeah, you are right, we did mention that we exited June with a 68% utilization, but it's just that the capacity is going to go up by another 1 million.

Okay, that is the perspective. Got it, sir. And, sir, when do we expect this additional line to come up here, this 2.5 MTPA?

It should be there in FY28.

By end of FY28?

Yes, yes.

Okay, sir, understood. Just, sir, one last clarification. Sir, in one of your notes to accounts, you've mentioned that the other income has a component of 55 crore due to some JV deconsolidation. Could you just elaborate a bit on that?

No, so we are in a JV, we are a JV partner in JSW1, and JSW1 intends to list within this financial year. That's their plan. Now, they did do some fundraise very recently, and so this 55 crore, so earlier we had to, because JSW1 was incurring losses, we had to write down the entire investment over different quarters of, but now their net worth is in positive zone, and this 55 crore is the share of that net worth, as per accounting standards.

Understood, sir. Just, sir, out of curiosity, what was the funding round at this most recent one?

No, I think that question should be asked to JSW1 as a vendor list.

Okay, sir, that's all for my end. Thank you.

Thank you.

Thank you. This is the final reminder for question. Please press star on 1 to ask the question. And no further reminders will be placed after this. Next question comes from the line of Kunal Shah with Dam Capital.

Yeah, hi, sir. So, this one on the North operations now, excluding the North sort of revenues, you know, how was the base cement realization moment during the quarter on a sequential basis?

It was plus 5.5% Q&P.

Understood. And so, obviously, we have not booked any incentives, but other than that, we were booking some, right? So, any other incentives that were booked during the quarter?

Yes, it was about slightly less than 6 crores.

Got it. Now, sir, on the Punjab expansion, sort of, we have excluded it from our foreseeable KPIX plans. Now, any issues we are seeing there structurally or just like a timing problem there? And what was the amount that has been invested for Punjab until now?

No, we have spent only on the land. That's about probably 50-60 crores. We have the entire land with us. A very small parcel is required to be purchased, which we would be doing it very soon. But most of the land is with us. I mean, I can say the whole of the land is with us. The plant land is with us. It's just the approach road, a little bit of it. Now, we are awaiting the EC. The EC can come anytime. A couple of rounds of discussion, where it has happened in the PCV. So once we have that, probably then we will initiate the work on at Punjab.

Got it. But just the CAPEX that you mentioned about the absolute amount, this would be including Punjab, right? I mean, you would have accounted for that as well, right?

Yes, yes, yes. It includes Palyard.

Got it.

Palyard is very integral to our entire North planet.

Got it. And so this is lastly one on the green energy share. Now, the target laid out during the second quarter last year was to achieve 49% by 4QF26 and 63% by F27. Can you just give, are we, like, sort of behind schedule on this one, and what are the reasons for this thing?

So, slight delays, that was more related to land, but that's all behind us now. As I mentioned earlier, within September, we'll have the entire whatever capacities we had informed earlier. That would be available to us now, in September.

Got it. So, we can hit, like, 60% plus by end of F27? Yes, sir.

Implemented, yes.

Two, three on the year. Yes. This is really helpful, sir. Thanks a lot. Thank you.

Thank you. Next question comes from the line of Girija Ray with Nirmal Bang. Please go ahead.

Hi, thanks for taking my questions. All of my questions are actually on check. I just wanted to check what is the original capacity utilization, particularly for the cement business?

We could hear you, Gereza. Could you repeat your question, please?

Am I audible? Yes, you are. Yeah, so most of my questions are answered, but I have one small question. That is, what is the reason why is capacity utilization for the cement business?

So, overall, for quarter one, we were at 61% for quarter one. And, yeah, there's no split that we offer on this.

Balance it?

No, it will be routed through PNL.

No, PNL means through revenue, right? It's like a GST accrual. Because capital subsidy, we understand, initially doesn't flow through revenue line item.

Yeah.

So, we were talking about the incentive, how it will flow through PNL or through revenue or through other line items.

There's a bit of complex accounting treatment, I understand, on the capital subsidy. I think this has to be recognized over the life of the asset. I think we'll have a discussion with the auditors and then probably answer this rather than giving a misleading answer.

Sure, sir. Sir, on the marketing expense, I see for the last 3-4 years, the run rate was around 80 to 85 crore. And Q4, we had a jump in FY26, Q4, and FY26 number went up because you're seeding for the North operations. And North, we have done around $30, $33 crore in Q1. So from an annual basis, what would be the incremental marketing expenditure you're looking at at $80, $85 crore from there? And second, when you said the North operations will break even and will turn positive. So, break even at EBITDA level or at FAT level? So, break even at EBITDA level.

About the first part of your question, see, today we have done about 33 crores in North, but overall at company level, we will be doing about 130 crores.

Okay, and this runway would continue for next few years, is what we can assume?

Yes, because we will be going into newer trajectory, so very soon we should be there in Punjab, we will be there in Western UP, Central UP, etc.

So this number is going to go up.

I understand, correct. Keep in mind this one steep road, what I mentioned, includes technical spins also.

Okay. And break-even, EBITDA break-even, what is the target you are looking at, sir?

No, in the second quarter, we should be EBITDA break-even.

Okay. So, fair to assume at 55, Today,

we have to transport limestone by road, and we don't have a street, et cetera. So, that explains why our medication is at a higher number, at 55-60% utilization. Had these all been in operation, number would have, break-even would have been at much lower levels.

Correct. I agree. And, sir, two small questions, follow-up. First, on the RMC, what is the full year number you are looking at, and is there any EBITDA number, EBITDA margin number for FI26 and FI27 in this RMC segment?

The revenue, we are targeting north of 1,000 crores, including this year, including the captive, that's what Lesh explained earlier, wherever the group projects are coming up. Now, today it's very difficult to speak on the margins because captive always has a different number than a commercial or a dedicated. It all depends how we grew. Initially, when we put up and our plans are to move from 15 to 35, so in the first year, in first 12 months, it hardly makes any money. RMCs don't make money. Right, right, right. Yeah. So being difficult to spell out the margins right now.

Understood. And so when you say captive, you are not talking within the JSW cement, within the group, right? Within the group. Within the group. Okay. And lastly, on the CAPEX number Q1, you have done C37 crore. And for full year, you are guiding 2300 crore. So, is it like chances of a miss because the runner is slower and I assume Q2 would be not very strong given a monsoon quarter? So, H2, the expectation from the CapEx could be much higher?

No, no. The number would be close to 2300. So, there isn't going to be any miss.

Understood. Understood. So, this is after your plans? Okay. Great. That's all from my end. We'll come back in queue. Thank you.

Thank you.

Thank you. Due to time constraints, the last question comes from Rashi with Citi. Please go ahead.

Thank you, Risham, for keeping questions. So, you delayed the Vijayanagar Phase 1 beyond C by 20, right? That was supposed to come earlier.

Sorry, Rashi, just repeat your question. You're not clear. No, not audible.

The Vijayanagar Phase 1, I think earlier the plan was to have it before C by 20, and that's now being pushed out, right? Right?

Yes, that's right. That's right.

And what is the timeline? Sorry, utilization?

No, no, basically you need to keep in mind the utilization and be prudent about how we can show the capacity utilization so the overall company is maintained. That's in mind. That was the input.

And what are the timelines for the Fujaira and the Dolby expansion?

Fujaira and the?

The Dolby, the 4 million times? The ones that are coming before CY28.

So, in Fujaira, we have done the groundbreaking last year. So, that should be up and running within 12 months. Dolby, we are planning to start the work very soon. So, that's 15 months from when I will be.

Okay. And for the Nagore project, the total capex for the 3.5 is 3,500 crores, right? And how much has it been spent so far?

We have spent close to 2,500.

Okay, and the next 2.5 is 430 crores. That's correct?

Yes, net of GST, yes.

Okay, and just last, what is the linker utilization in the quota?

Come again?

Linker utilization.

It's at 61% including Nagor in India. I'm saying, okay, this is between Nandiyar, Shiva, and Nago. It's at 61%. I mean, if you want to knock off Nago, then the knock off goes up to 87%.

Okay, so that's Klinka. All right.

Thank you. Ladies and gentlemen, as there are no further questions, we have reached at the end of question and answer session. I now hand the conference over to Mr. Weber Agarwal for closing comments.

Yeah, thank you. On behalf of Philip Kravatil, India Private Limited, we'd like to thank the manager, J.S. Dubu Suman, for the call, and also many thanks to the person joining the call. Thank you very much, sir. And you may now conclude the call.

Thank you. On behalf of Philip Capital that concludes this conference, thank you for joining us. You may now disconnect your lines.