The India Cements Limited

22.23 lakh

he number or break up in terms of whatever cement sales and clinker sales? Management: (cid:9) 22.23 lakh tons was the cement sales and clinker sales was only 4,000. Sorry. 22.50 lakh tons was the sale o

22.50 lakh

Management: (cid:9) 22.23 lakh tons was the cement sales and clinker sales was only 4,000. Sorry. 22.50 lakh tons was the sale of cement and 0.04 lakh tons was the sale of clinker. Amit Murarka: (cid:9)

0.04 lakh

cement sales and clinker sales was only 4,000. Sorry. 22.50 lakh tons was the sale of cement and 0.04 lakh tons was the sale of clinker. Amit Murarka: (cid:9) 22.5 and 0.4. Management: (cid:9) 22.54 i

100 crore

Sir, the other question is on the transaction we did in early October. So, we have about another 100 crores to be received basically. So, is it a correct understanding, sir, on the transaction? Management

200 crore

reduction in terms of debt, sir, consideration? Nlanagement: See, what we have done is about 200 crores has gone for correcting the current ratio. Balance money is sitting as a reserve. We will repay

Rs. 3.26

er Kcal basis, how much was it for the quarter and in the prior quarter? lanagement: Coal was Rs. 3.26 per Kcal. (cid:9) The India Cements Ltd PhillipCapital Ritesh Shah: So, that was in

Rs. 3

nt: (cid:9) You see, the expectation is that coal will be closer to 3 and maybe just a shade under Rs. 3 per Kilocal. Ritesh Shah: So, this looks higher than what we had in this quarter. So, is it on

rs,

ith a notification wherein if it comes to gold coins or overseas trips that we do it for the dealers, there would be an additional tax also on that. Sir, what will be our stance over here? How should

84%

I would like to know the, can you just share the fuel mix for this quarter? Management: Coal is 84%. Petcoke 11%. Shouvik Chakraborty: So, can you just repeat? Sir, I was not able to get it. You

11%

to know the, can you just share the fuel mix for this quarter? Management: Coal is 84%. Petcoke 11%. Shouvik Chakraborty: So, can you just repeat? Sir, I was not able to get it. You said 7% Petco

7%

coke 11%. Shouvik Chakraborty: So, can you just repeat? Sir, I was not able to get it. You said 7% Petcoke, right? Management: Coal is 84%. Petcoke is 11%. Shouvik Chakraborty: And also, can

Rs. 30

se at all whatsoever, whereas in Tamil Nadu, Kerala, Karnataka, Andhra, Telangana, we got between Rs. 30 to Rs. 40 a bag. So, you have to look at the average for total sales, and that is the price increa

“Srinivasan — Vice Chairman & Managing Director of the company for his opening remarks, which will be followed by interactive Q&A.”

“We are seeing signs of it with the last month we had there was an increase, and this month there will be a further increase.”

“The India Cements Ltd PhillipCapital So, I expect that by the end of this month, the prices of cement, cement prices would have gone up to such an extent that they will for all companies it will be close to breakeven, and next month the increase contemplated will push cement industry into the black.”

“Manish Oswal: (cid:9) Secondly, sir, you comment about the industry turning into black in the next quarter.”

“So, for 2.5 months there will be no effective increase, decrease in the cost of coal.”

“It is because the cement price is going up, which is what we expect.”

“So, given the current environment of supply etc., is it reasonable to expect pricing to be stronger, sir, in the next six months to one year at least, given that so much supply also is coming to the market, sir?”

“But to answer your question, I still expect pricing to be strong.”

“Management: (cid:9) You see, the expectation is that coal will be closer to 3 and maybe just a shade under Rs.”

Management

21

Ritesh Shah

8

Moderator

4

Krishna Kumar

4

Shouvik Chakraborty

4

Amit Nlurarka

3

Amit Murarka

3

Nlanagement

2

Vaibhav kgarwal

1

Nioderator

1

Vaibhav kgarwal

Yes. Thank you, Tanvi. Good afternoon everyone. On behalf of PhillipCapital (India) Private Limited, we welcome you to Q2 and HI FY23 Call of The India Cements Limited. On the call we have with us the entire Senior Management team of the India Cements. I would like to mention on behalf of The India Cements Limited and its management, that certain statements that may be made or discussed on this conference call may be forward-looking statements related to future developments and the current performance. These statements are subject to a number of risks, uncertainties and other important factors that may cause the actual developments and results to differ materially from the statements made. The India Cements Limited and the management of the company assumes no obligation to publicly update or alter these forward-looking statements whether as a result of new information or future events or otherwise. I will now hand over the floor to Mr. N. Srinivasan — Vice Chairman & Managing Director

Management

Thanks, Vaibhav. Good afternoon, ladies and gentlemen. The second quarter India Cements incurred posted a loss, which is the highest in its history so far. What caused this? An unprecedented rise in the cost of coal which naturally increase the cost of production which could not be compensated by an immediate price increase. As a result of which, see, the cost increased because of direct fuel cost, it increased because of the cost of power. Coal to power also went up and packing materials. As a result of which it was impossible at that time to immediately pass on the increase in cost to the consumer. So, we had to bear it. There is no other reason except that the material cost of coal shot through the roof. Efficiency of the factories were okay. We really did not have any other reason for the increase in cost and consequence variable cost going up. I mean, what was 2,300, 2,000, 2,100 went up to 3,600,3,700, and it was not possible to what happens now? We have now the cement industry a

Management

See, I am not talking of the industry as a whole. It is possible that the industry will turn into the black provided people increase the prices. After the festive season, the demand is brisk. The demand is showing signs of picking up after Diwali.

Amit Nlurarka

So, continuing on the power and fuel costs, so what kind of decline are we expecting in the third quarter on that number?

Management

You see I am not expecting a decline in the cost of coal. Coal, you see, for example, if you were to import American coal, the lead time is 2.5 months. So, I should have booked coal now. The coal I have booked is at the current prices which will land 2.5. So, for 2.5 months there will be no effective increase, decrease in the cost of coal. What I meant was that the price of cement will go up. The margins will reappear not because the coal cost is going down. It is because the cement price is going up, which is what we expect. The India Cements Ltd PhillipCapital Amit Murarka: (cid:9) Also on volumes, like can you please share the number or break up in terms of whatever cement sales and clinker sales? Management: (cid:9) 22.23 lakh tons was the cement sales and clinker sales was only 4,000. Sorry. 22.50 lakh tons was the sale of cement and 0.04 lakh tons was the sale of clinker. Amit Murarka: (cid:9) 22.5 and 0.4. Management: (cid:9) 22.54 in total, clinker and cement put together. Amit

Amit Nlurarka

And the last question is, also, there was some change in the discounting structure and pricing structure that was being attempted after I believe the change of ownership. So, how do you think this will impact the price realizations generally for the industry?