SANGHIINDNSE6 May 2025

Sanghi Industries Limited has informed the Exchange about Transcript on earning concall held on 29th April 2025 on the Audited financial results of the company for the quarter and F Y ended 31st March...

Sanghi Industries Limited

6th May, 2025

To, BSE Limited PJ Towes, Dalal Street Mumbai – 400 001 Scrip Code: 526521

To, National Stock Exchange of India Limited Exchange Plaza, Bandra - Kurla Complex, Bandra (E), Mumbai – 400 051. NSE Symbol: SANGHIIND

Sub: Transcript of Earning Call pertaining to the Audited Financial Results of the

Company for the Quarter and financial year ended 31st March 2025.

Dear Sirs/ Madam,

In continuation of our letter dated 23rd April 2025 and 29th April 2025 regarding Analyst/Institutional call scheduled on 29th April 2025, the transcript of the earnings conference call on the Audited Financial Results for the quarter and financial year ended 31st March 2025 is uploaded on the website of the Company at www.sanghicement.com The said transcript is also attached herewith.

The Web https://www.sanghicement.com/investors/

access

link

above

transcript

under

Kindly take the above on your record.

Thanking you,

Yours faithfully, For Sanghi Industries Limited

Anil Agrawal Company Secretary & Compliance Officer

Encl : As above

Sanghi Industries Limited Registered Office: Adani Corporate House, Shantigram, Nr. Vaishnodevi Circle, S. G. Highway, Khodiyar, Ahmedabad – 382421 Gujarat, India Ph +91 79-2656 5555 www.sanghicement.com

CIN: L18209GJ1985PLC157787

Ambuja Cements, ACC and Sanghi Industries Limited

Q4 FY '25 Earnings Conference Call

April 29, 2025

MANAGEMENT

MR. VINOD BAHETY

MR. RAKESH TIWARY

CHIEF EXECUTIVE OFFICER

CHIEF FINANCIAL OFFICER

MR. DEEPAK BALWANI – HEAD, INVESTOR RELATIONS

MR. RAJESH RAVI – HDFC SECURITIES LIMITED

MODERATOR

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Moderator:

Ladies and gentlemen, good day, and welcome to the Ambuja Cement Limited Q4 FY '25

Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

Earnings Call. Hosted by HDFC Securities. 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 call, please signal an operator by pressing star

then zero on your touchtone phone. Please note that this conference is being recorded.

I now hand the conference over to Mr. Rajesh Ravi from HDFC Securities Limited. Thank you,

and over to you, sir.

Rajesh Ravi:

Thank you, Alaric, and thank you, everyone, for joining in this call. I welcome you all from on

behalf of HDFC Securities.

I now hand over the call to Mr. Deepak Balwani, Head of Investor Relations. Over to you, Mr.

Deepak.

Deepak Balwani:

Thank you, Rajesh. First of all, apologies for the delay. On behalf of Ambuja Cements, I would

like to extend a warm welcome to all participants joining us for the earnings call for the fourth

quarter FY '25. Ambuja Cements Limited is one of the India's leading cement companies and a

member of the diversified Adani Group, the largest and the fastest-growing portfolio of

diversified sustainable businesses.

As Adani Group continues its rapid expansion across industries and geographies, Cement

business is implementing a strategic leadership realignment that sharpens commitment to growth

supported by internal talent development. Over the last couple of years, Mr. Vinod Bahety has

been setting the foundation for making Ambuja Cements as an industry leader. As CFO, Mr.

Bahety led the acquisitions of Sanghi, Penna, My Home, Asian Cement and the most recent

Orient Cement. Mr. Bahety has now been elevated to the role of Whole Time Director and Chief

Executive Officer of the company with effect from 1st April 2025.

Appointment of Mr. Rakesh Tiwary as Chief Financial Officer of the company. Mr. Rakesh

Tiwary is a qualified Chartered Accountant, Cost Accountant, Company Secretary and MBA

with about 30 years of work experience in airport, power, utilities, solar panel manufacturing

and steel production. Mr. Ajay Kapur has been elevated as a Managing Director of the company.

Before we start, please note that this call may include forward-looking statements based on our

current beliefs and expectations. These are not guarantees of future performance and may

involve unforeseen risks and uncertainties.

We are pleased to have with us on the call Mr. Vinod Bahety, Chief Executive Officer; and Mr.

Rakesh Tiwary, Chief Financial Officer. Now I invite Mr. Bahety to provide his relevant insights

on the quarterly performance.

Vinod Bahety:

Thank you, Deepak. Good afternoon, and a warm welcome to each of you for our Q4 and FY 25

Earnings Call. This quarter and these results will remain special because, friends, I'm happy to

share that Ambuja Cement has crossed more than 100 million tons of cement capacity, becoming

the ninth largest cement company globally. Others have taken decades, but we have achieved

this in 30 months.

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

We continue to strengthen our position as a market leader in the cement industry. Adani Cement

is getting stronger over time, underscoring our strategic focus on growth, operational excellence,

increasing market presence, strengthening ground network, efficiency improvements and cost

leadership.

We remain committed to sustaining our market share by achieving consistent volume growth

and high ESG performance, delivering unmatched value for our stakeholders. We are happy to

share that our subsidiary, ACC, has become India's first large-scale cement company with

science-based net zero targets validated by SBTi. Through our community engagement

initiatives, we have delivered societal value for 5.7 million lives.

I would like to share some of the high-level highlights before diving into specifics. 99-megawatt

wind power at Khavda has been commissioned in Q4 FY '25. I had mentioned last time that by

June '26, entire 1,000 megawatts will be up and running. Already, we have achieved 300

megawatts. 367 million tons of new limestone reserves secured in Q4 '25, taking the total

limestone reserves to 9,000-plus million metric tons.

With the completion of Orient acquisition, commissioning of grinding unit at Farakka and the

debottlenecking of capacity at various plants, as I mentioned, that we have now crossed 100

million tons. Sooner, we should be also announcing additional grinding units to be

commissioned in Q1, primarily Sankrail and Sindri. And with every prospective quarters, we

should be hitting 118 million metric tons by end of this financial year.

The consolidated quarterly Y-on-Y performance is as under. We achieved a revenue of INR

9,889 crores, up by 11% Y-o-Y, driven by strong focus on our micro market management

strategy, expansion of our ground network, blended cement, which remains at 82% and increase

in premium products as a percentage of our overall trade sales, which is up by 5.3% to 29.1%.

Operational costs for the quarter stood at INR4,104 per ton. This is driven by better fuel

management and strong focus on green power. Kiln fuel cost has reduced by a whopping 14%

to INR1.58 per 1,000 kilo calories from INR1.84 per 1,000 kilo calories. The transportation cost

also declined 2% at INR1,238 per ton on account of footprint optimization and closer to market

strategy. With increasing grinding units, this is expected to further come down.

Primary distance lead has reduced by 15 kilometers at 265 kilometers and secondary lead by 2

kilometers at 46. Direct dispatch to customers increased by 600 basis points to 58%. With the

improvements mentioned on the cost front, EBITDA stood at INR1,868 crores at an EBITDA

margin of almost 19% and EBITDA per ton at INR1,001.

As on 31st of March '25, the consol cash and cash equivalent stands at INR10,125 crores. The

consol FY'25 Y-on-Y performance is as under: highest ever annual revenue of INR35,045

crores, operational cost at INR4,275 per ton, EBITDA stood at INR5,971 crores and EBITDA

per ton at INR915 as we aim -- this INR915 is for the year, but now our journey anyway is going

to be towards achieving INR1,500 EBITDA per ton by FY '28.

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

And you have seen a good level of improvement in the last quarter, March quarter. In the best

interest of time, I'm not going to discuss the standalone financial performance of the listed

companies separately as they are available on the stock exchanges.

Now I will share with you the progress which we have made on our announced long-term

strategic plan. We have crossed the 100 million tons capacity, growth of nearly 50% in 30

months. Our growth journey continues as we aim for 118 million tons by FY '26 and 140 million

tons by FY '28 through largely this time driven by organic expansions.

Focus for FY '26 is on commissioning of our fairly advanced stages projects like Sankrail, Sindri,

Salai Banwa, Dahej, Marwar, Kalamboli, Krishnapatnam, Bhatinda, Jodhpur and Warsaliganj.

We are on course to commission our 4 million tons of clinker unit at Bhatapara in Chhattisgarh

and the associated grinding units in Sankrail in Bengal and Sindri in Jharkhand by Q1 '26.

The grinding units at Salai Banwa in Uttar Pradesh is expected to be commissioned in Q2 of '26.

Kalamboli unit expansion in Maharashtra is targeted to be commissioned in Q3. Brownfield

expansion of Bhatinda in Punjab, Marwar in Rajasthan, Dahej in Gujarat and Jodhpur in

Rajasthan -- Jodhpur as an integrated unit of that Penna, which was under construction -- is

expected to be commissioned by Q3 of FY '26.

Further, the clinker unit of 4 million tons at Maratha in Maharashtra and grinding unit at

Warisaliganj in Bihar are also expected to be commissioned by the end of FY '26, enabling us

to reach 118 million tons capacity by FY '26. We have also identified 9 additional grinding unit

projects for which land acquisitions and statutory approvals are under process, which shall

enable us to reach 140 million tons, which is by FY '28. So there's a clear, clear blueprint which

is there to achieve 140 million, which we had committed way back in 2022 September.

For the new facilities, 4 million tons per annum clinker at Bhatapara, as I said, it is expected by

Q1 of '26. We have made 87% progress. Overall, erection work is almost completed. Refractory

and P&I work and no load trial is in process. The overall project progress for Sankrail is 88%.

And as I said, it's expected by Q1 of '26. And over there also, major equipment have already

been installed and under process of the dry runs.

For the new facility of 4 MTPA clinker line at Maratha in Chandrapur, 76% of the major

equipment ordering is done and 44% civil work is completed, and it's expected to be

commissioned by Q4. These kiln lines will have 42 megawatts of WHRS and provision for

utilizing 30% of AFR in the kilns.

For the new facility of 3 MTPA clinker line at Jodhpur, 95% of civil work is through and major

equipment ordering is done. 48% mechanical erection work completed and expected to

commission by Q3 of '26.

So and so forth, I think the entire road map for the project expansion is there in the presentation.

I won't take more time on that. Now I will share some of the key initiatives being undertaken --

for becoming the cost leader in the Indian cement industry. Raw material costs, we have secured

raw material at competitive prices and efficiency and productivity improvement. capex will

further help in raw material cost optimization by 8% to 10%.

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

Friends, as you know, we have put our commitments to achieve INR3,650 per ton of cost by FY

'28. Our long-term fly ash agreements, supply chain synergies and operational efficiencies will

ensure that the cost reduction goes hand-in-hand with our relentless pursuit of quality.

On the energy side, as of now, we have WHRS capacity of almost 218 megawatts. And down

the line, we are targeting to achieve 30%, including all the new projects at 140 million capacity,

30% to be WHRS. We have already earlier announced our investments of 1,000 megawatts of

renewable energy, which is expected to commission by '26. 300 megawatt is already up and

running, which I have already shared with you.

As previously explained to meet our requirements, we aim to maximize captive coal

consumption. As a result, we are bidding for coal mines in the auctions being conducted by the

Government of India. A higher share of coal from the captive mines and the opportunistic buying

of imported pet coke will help us to reduce our overall basket of, say, fuel and therefore, fuel

cost.

Cost reduction possible through multiple strategies of maximization of the domestic coal, 40%

of the kiln heat mix, linkage booking, 2.4 million tons for the next 10 years, of which 1.4 million

tons by direct rail. Linkage coal rate plant through GPWIS rake, which is like our own rakes,

first time in cement industry, thus ensuring regular low-cost linkage movement to expect start

from Q2 of '26.

Leveraging of group synergy in booking of low-cost imported pet coke and imported coal is the

underlying point, which will be there continuously right from the beginning, it has been helping

us. Driven by better fuel management and structural initiatives undertaken, our kiln fuel cost

reduced by 14% from 1.84 to 1.58. These initiatives include better fuel mix and source mix

optimization. The share of green power and power mix has increased to 26% from 15.6%, almost

10% improvement.

Coming to the another major cost focus, which is freight and forwarding. There are 3 focus areas

for cost reduction here: reduction in the lead distance, warehouse footprint optimization and

railroad mix optimization. We are targeting to reduce the lead distance by almost by about 100

kilometers to 170 kilometers.

Primarily lead distance in the current quarter was 265 versus 280 and secondary at 46 versus 48.

And this has been done with improvement in direct dispatch by 600 basis points from 52% to

58% and overall network optimization.

We have enhanced our coastal presence, empowering a model shift towards increased share of

marine logistics, driving reduction in the emissions and costs. To further optimize our cost in

logistics, we have ordered 11 GPWI rakes, of which 11 have been all delivered and running in

approved circuits. This rakes will enable cost-efficient clinker movement from the mother plants.

In addition to this, we have also ordered 26 BCFC rakes for safe and cost-effective transportation

of fly ash from thermal power plants to our facilities. Of these 26 BCFC rakes, 8 rakes have been

delivered in FY '25. Because of these initiatives, our overall logistics costs have reduced by 2%,

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

but this is just the beginning. You will see more and more improvement in coming quarters. But

this 2% reduction from INR1,258 to INR1,238, which has been achieved.

On the limestone, we have secured almost 367 million tons of limestone. And as I said in my

initial remarks, we have reached to 9,000-plus million tons. This 367 million tons comes from 3

new mines; 2 of them in MP and one in Assam. In terms of ESG, we have made significant

progress on our ESG agenda.

We took actions on multiple fronts to inch closer to our ambitious commitment of net zero by

2050. Lots of details on the ESG are already there in my presentation. I won't spend more time

on this now.

Coming to the digital part, we have embraced industry 4 predictive analytics, automation,

artificial intelligence, ML and several digital technologies to enhance efficiency, streamline

operations and improve our customer experience. This is an area of trend very close to our

leadership, and we will drive a lot on this. And you will see lots of good progress coming in

terms of the efficiency improvements, optimizers, which will in turn help us in terms of

improving our overall EBITDA.

Our brands stand as a testament to the trust and quality with innovation and customer-centric

solutions. To better serve our customers, we are strengthening our distribution network through

investments in logistics supply chain and overall regional expansion.

On the industry side, trends, I remain positive as cement consumption grew almost 6.5% to 7%

in Q4, and we are expecting that it will have a continued improvement and reach, say, 8% overall

demand growth for FY '26. This is supported with improved construction activities, rural

demand, the overall, say, housing and increased government spending. Cumulative growth for

FY '25, we believe is for the industry between, say, 4% to 5%. But as a company, we have

delivered better than the industry results.

To conclude, friends, Adani Cement will benefit from accelerated growth, lower costs driven by

and supported by group synergies, all of which will contribute to lead the market share and

achieve sustainable performance in the near future. We believe that a strong leadership team is

paramount to achieving organizational goals and driving success.

The leadership team set the strategic direction, making critical decisions and inspire the entire

organization. We have made significant new additions to our leadership team to make our

organization more agile and responsive to market demands.

I'm pleased to -- because first time like we are coming on this call after this appointment, I'm

pleased to introduce you the new members of our leadership team. Mr. Sanjay Bahl, who is the

Head of Sales, Marketing and Logistics.

Sanjay brings with him a wealth of experience and a proven track record in driving sales growth

via branding excellence. His strategic insights will be instrumental in expanding our market

presence and enhancing customer engagement. Previous to joining Adani, Sanjay has worked as

CEO in Greaves and Raymond, where he has been instrumental in business turnarounds.

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

Rakesh Tiwary, our homegrown leader now who has taken over as the CFO. Rakesh's expertise

is in financial management and his deep understanding of the industry will be crucial in steering

our financial strategy and ensuring robust financial health. Rakesh has been veteran in the group

and has led as CFO of many important group companies and most recently worked for the

airports business.

Madhavi Isanaka has joined us as the Chief Digital Officer. I told you that digital will be a key

focus area. Madhavi's extensive experience in digital transformation will help us leverage

technology to drive innovation, improve operational efficiency and enhance the overall customer

experience.

Madhvi had a long stint in USA for 20 years, after which she joined Adani a year back. After

leading digital transformation agenda in the Adani Green Energy, he has joined Adani Cement

to help us drive the digital agenda here.

And our new -- another addition who is a young leader at the age of 46, he is now my Head of

Manufacturing, Vaibhav, who joined the business way back in Ambuja -- in ACC, in fact, as a

GET in 2000 and Vaibhav's journey from a GET to the Head of manufacturing is truly inspiring

and serves as an inspiration for any young campus cadre. Through dedication and hard work, a

relentless pursuit of excellence, Vaibhav steadily climbed the ranks within the company.

Additionally, we are thrilled to welcome over 1,000 campus graduates who have joined us from

prestigious institutions across the country. These graduates have been hired in a first-of-the-kind

touchless hiring to eliminate any interview biasness and have been hired under the overall

guidance of our Chairman's vision of building skills and employment at local level.

With this, we are aggressively refreshing our talent pyramid to bring in more agility and optimize

our cost of talent. These hires will fuel our growth and innovation and represent the future leaders

of Adani Cement.

From an overall talent management perspective, we have deployed new operating model and

now working towards a culture of internal nurturing of talent and providing faster road map for

growth for our performing talent. In terms of agility and cost optimization, we have now

executed the operating model change of incorporating shared services setup wherein we have

moved HR, IT, procurement, finance function to the shared services, what is that GCC, what we

say it here, with clear service level agreements and rapid technology deployment to rationalize

cost and speed of our operations.

These strategic developments in our team at the leadership as well as at the entry level with the

operating model changes are a testament to our commitment to build a dynamic and forward-

thinking organization. We believe that these changes will drive our company towards greater

success and create significant value for our stakeholders.

We are happy to be the fastest-growing cement company in the country from being also the

highest, which is at Darlaghat to being -- having an oldest operating plant, which is Lakheri,

which I call it as OHF story of Adani Cement. And in our journey to become most valuable, we

are now duly supported by talent and technology.

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

Finally, friends, we are driven by purpose and defined by progress. We too have a small role in

building our country, We will show you by doing it. 100 million tons in 30 months is a

remarkable achievement. As a team, we feel proud about it to have a contribution in nation

building.

With this now, I will hand over to my newly appointed CFO, Mr. Rakesh Tiwary, for his opening

remarks, and then we'll quickly come to the Q&A. Rakesh

Rakesh Tiwary:

Yes. Thank you, Vinod, for the inspiring talk, and then it was really great. So good afternoon,

everyone, and it's great to connect with all of you today at such a pivotal moment in our journey.

Over the past few quarters, we have been relentlessly focused on 4 pillars, which are growth,

ESG, cost reduction and stakeholders' value creation.

And I'm thrilled I'm going to update you on all these 4 pillars as to how we are delivering across

all the fronts. But before I proceed, let me take the first thing first, the major milestone. Ambuja

Cement has crossed 100 million tons per annum and a big congratulation to Vinod, under whose

leadership the same has been achieved in a very short period of 30 months. And it's really a

congratulatory time to Vinod and entire cement team and to the entire Adanian. And this is like

we are just getting started.

We are on the course to hit 118 MTPA by financial year '26 and 140 MTPA by financial year

'28 as we have promised in September '22. The recent acquisitions of Sanghi, Asian, Tuticorin

grinding unit, Penna and Orient, they have turbocharged our growth. And I'm happy to report

that the integration of these assets is progressing extremely well, unlocking the synergies faster

than what we expected across operations, logistics and procurement.

To put into perspective, the broader environment is also working in our favor. So the current --

I mean, the country's cement demand remains very strong, driven by infra investment, housing

need and rapid urbanization. Now Ambuja is uniquely positioned to ride this multiyear growth

wave with a robust platform and a future-ready strategy.

Looking back, it has been incredible 30 months since we acquired the Holcim stake in September

2022. And from March '25 quarter onwards, now you will see that there is an acceleration of

organic growth complemented by all the brownfield expansion which we have done. This will

not only add capacity and market share, but also fortify our cost leadership journey.

Importantly, almost 40%, 50% of our capacity is new. And it is giving us a huge impetus, huge

advantage in terms of higher efficiencies across capex, opex, green power and the infrastructure

which is being built. On cost leadership, as we have announced the team, which we announced

at that point of time in March '24, we targeted a cost reduction of close to INR500 per metric

ton, and I'm happy to share that we are firmly on the track for the same.

On the renewable energy front, we had committed setting up of a gigawatt of renewable energy

project and the same is starting being delivery and it is on track. Already 200 megawatts of solar

and close to 100 megawatts of energy has been delivered by March '25, and the full gigawatt

will get commissioned by quarter 2 of financial year '26.

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This massive RE shift will not only lower our energy cost, but significantly reduce our carbon

footprint, which is underscoring our strong commitment to sustainability and ESG leadership.

Another area where we are making real stride is the digitization piece. Our query to lorry digital

transformation is taking firm root, enhancing operational efficiencies, and it is becoming a key

catalyst for the growth and the EBITDA enhancement which is happening and the margin

expansion which is being done.

Most of you who have visited this building, ACH Adani Corporate House, must have seen our

CNOC, our cement network operating center, at our headquarters. We are continuously adding

new features, which is ensuring that our century-old industry becomes smarter, faster and more

agile. And Ambuja is leading the traditions towards a younger, more tech-driven cement

industry.

On financials, Vinod has given a detail point-wise in terms of how actually we have done. But

just to make you a little bit comfortable, the balance sheet has never been so strong. The net

worth has climbed to close to INR64,000 crores, up from close to INR50,000 crores a year ago.

That is the point number one. Point number two, we still remain debt-free. Point number three,

we are enjoying the highest credit rating in this industry.

And point number four, our tangible assets, which is TP and cash, which forms a strong share

of our net worth with cash and cash equivalent at the industry-leading level. So these are the 4

pillars on which the financials have been built up. At the same time, we continue to follow a

disciplined approach towards our capital allocation, I mean, prioritizing high-return projects and

maintaining a razor sharp focus on the profitable and sustainable growth.

And lastly, a few words on our organization. See, we have further strengthened our leadership

team, which Vinod has totally explained in terms of making it a more young and agile team and

a young operating team to support this new phase of accelerated growth. Talent is the real engine

behind this flawless execution, and I'm confident that our team are geared up to deliver superior

results quarter after quarter henceforth.

In conclusion, while the industry is entering an exciting phase, Ambuja is at the forefront, poised

for growth, margin expansion and enhanced stakeholder value, powered by cost leadership,

green energy, digitization and an exceptionally strong balance sheet. We are building a future-

ready Ambuja and the best is yet to come.

With that, I'll now hand over to the coordinator back again.

Moderator:

Thank you, sir. We will now begin with the question and answer session. The first question

comes from the line of Rahul Gupta from Morgan Stanley.

Rahul Gupta:

Two questions from my side. Heartening to hear that cost optimization journey is on track. But

can you please help us understand the quantum of cost savings achieved during the year? Also

is there any change in the guided benefits of INR100 per ton in fiscal '26 and INR150 in fiscal

'27? That's my first question.

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Vinod Bahety:

Thank you, Rahul. When we started way back in September '22, we had been at the levels of

Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

INR4,250 around of cost. And then somewhere like in March '24 quarter , we have been at, say,

INR4,170 around that level, and then we committed to achieve INR3,650. In this journey, so far

we have achieved already around INR150 to INR175 per ton of cost and the balance INR300 to

INR325 per ton is what we are going to expect in FY '26 to up to '28.

Now this cost largely will be driven by 3, 4 factors. One is our continued investment on WHRS,

AFR and renewable power as one component. And second is the fly ash and for which, for

example, we are setting up the fly ash handling systems. Just to share and I mentioned last time

that we have entered into a 10-year agreement with Adani Power for 5 million tons of fly ash

supply at almost negative 400 wherein we have invested into handling the fly ash from the Tiroda

power plant to some of our grinding units.

Now these are, like, strategic investments which are being made. Then this BCFC is going to be

a game changer for us. So -- and on top of it, still the marine logistics has not taken and achieved

its full play, but we are in a fairly good stages of ordering almost like 8 shipping vessels and

which will help us to achieve a significant improvement in our marine shipping or marine

transportation as well.

So I think the journey is very clear. INR3,650 is, for example, which we have a complete detailed

blueprint. And every passing quarter, we are increasing it. In terms of green power, now green

power when we got 300 megawatts, it's already started reflecting in my power cost per unit

wherein it has reduced by almost INR0.20, INR0.25 to what we were getting, say, last quarter.

And so on and so forth, I can go with more details. So I think this is a larger broader outline on

the cost part.

What was your second question, Rahul?

Rahul Gupta:

Yes. So I just wanted an update on the guidance for the next couple of years. I remember last

quarter, you talked about higher -- greater than INR100 per ton savings expected in fiscal '26

and another INR150 in fiscal '27. So that's broadly on track, right?

Vinod Bahety:

That's absolutely broadly on track. In fact, I'm going to also work -- the whole team is committed

here to work to achieve it before what we have committed. So that is like the spirit what we are

working on. But like 3,650, absolutely a clear road map.

Rahul Gupta:

My second question is on the revenue side. Our share of premium products has improved to

29%. Can you just help us understand how to look at this over the next couple of years, taking

into account your expanded capacity, both on organic and inorganic basis?

Vinod Bahety:

Very good question again, Rahul. In terms of our premium cement, right from beginning, I think

both the brands have been doing extremely well. And the share of premium cement have been

averaging, say, 25%, 26%. And this time, it is like 29%, 30%. Our focus remains very core to

promote the premium cement because we also see the customers are looking forward to it.

Towards this, for example, we are substantially increasing our ground network. We are putting

a whole lot of branding and promotion activities around this. We are also going to ensure a

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

consistent quality supplies towards this. The trade sales because this premium product actually

becomes part of the trade sales. And precisely over there, our deeper engagement on the ground

will help us facilitate it.

Typically, you will know that the premium cement, for example, gives you almost INR200 to

INR300 per ton extra realization, and that is what's going to differentiate the leader from the

others. Our target for FY '26 is around 35% on the premium cement.

Moderator:

The next question comes from the line of Amit Murarka from Axis Capital.

Amit Murarka:

So my first question actually is on ACC. So there were a few like transactions in ACC, which I

just wanted to understand better. So one, there was some land purchase under ACC Mineral

Resources, which was for about INR680-odd crores. So could you help understand like to what

is this land for? And by when can we expect -- I believe new capacities also are planned on this.

So some clarity on that, please.

Vinod Bahety:

Yes, yes, sure. I think there have been these investments which is coming from ACC. I can

actually answer your question on a larger level so that if there are any other questions, which

will -- I'm pre-empting it so that it can be replied in one go.

See, overall, for example, in terms of ACC, there has been an outgo of, say, almost INR1,100

crores in terms of the cash balance from INR4,660 crores to INR3,590 crores. Now on top of it,

we also had this EBITDA and other income. So if I add to that, then the overall investment is

around INR4,500 crores in case of ACC, out of which INR2,300 crores is towards the overall,

say, investments in the fixed assets and some of them in CWIP.

This is like a broader number, then I will come to specific items. Then also, there has been a

working capital deployment of INR1,300 crores, and this is absolutely to the third-party

companies wherein, for example, an early payment to the MSME vendors, then also in terms of

the opex vendors which we have also taken a treasury arbitrage.

Then there has been this lease liability payment of INR750 crores, and this is like one area which

I will highlight. And then on top of it, it's a dividend payout and tax outgo. So almost like closer

to, for example, INR4,500 crores in terms of deployment.

To your question about this land and particular, say, investments, which is closer to about

INR690-odd crores, this have been invested especially for the land in the western side of the

country where we have plans to set up the grinding units and also acquire the -- we have acquired

the coal mines. So this is as a business overall is going to benefit. This is closer to Chanda. And

as I said, the plants are there in terms of the overall coal and plus the grinding unit. So this is

like one point.

Second is in terms of the BCFC wagons for Ametha, Kymore, Wadi, ACC has also invested

around INR750-odd crores. Then for my Salai Banwa and Sindri, which is like work in progress,

some of you would know that ACC is in fairly advanced stages of commissioning them, close

to INR500 crores has gone towards the investments around that. Then we have also put in WHRS

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

investments for Chanda and Wadi II, and we have also put into investments with respect to the

overall the coal mines and the BCFC and so on and so forth.

So from a land perspective, this has gone purely from grinding units to the prospect of the coal

mines for which the land is required. Now as a business, sometimes we cannot segment out

between Ambuja and ACC because as I said, these are like a one single composite business.

Sometimes Ambuja will invest and sometimes ACC will invest.

When Ambuja invests, ACC gets the benefit of MSA. When ACC invests, Ambuja gets the

benefit of MSA. So this has to be looked upon instead of completely clinically segmenting it.

And this is, for example, which will also help you to understand the perspective.

What was your next question, Amit?

Amit Murarka:

Yes. So this is helpful. So the land purchases for coal mines largely is what I understand then.

And some…

Vinod Bahety:

Coal mines and the grinding units both actually.

Amit Murarka:

Okay. But no clinker plans in this?

Vinod Bahety:

There are coal blocks also, they are around Chanda, so 3 of them, so limestone blocks, the

grinding units and the coal blocks.

Amit Murarka:

Sure. Okay. And also there was some impairment of cement plant…

Moderator:

Sorry to interrupt, Amit. I would request you to fall back into the queue if you have any more

questions so that the management can answer as many participants as possible.

Amit Murarka:

Just this last one if I can. It's related to the earlier question. So there's some impairment also of

the cement plant. So I also wanted to understand that what was this impairment for?

Vinod Bahety:

Amit, we have also, I think, highlighted that some of the old assets, which are clinker units, but

we find now unfeasible are like Bargarh, Chaibasa and the Wadi line number 1, so which we

have decided right now to put them off. And therefore, proactively, we are providing for those

assets.

If I'm not wrong, it is around close to INR200-odd crores, which is what we have provided. But

this is purely like a proactive prudently prudent accounting so that down the line, we will decide

not to -- to actually discontinue these assets from a clinking perspective. So far as grinding is

concerned, Bargarh is right now working from a grinding perspective.

Wadi one line, for reference, we already have started the process of dismantling.

Moderator:

The next question comes from the line of Indrajit Agarwal from CLSA India.

Indrajit Agarwal:

I have 2 questions. First, on other financial assets on consol, there is about a INR1,700 crore

increase from March last year to this year. So one, what is this related to? And second, on the

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

land acquisition that you have done in ACC, the grinding unit that you talked about, is it part of

the plan to INR140 crores? Or would it be beyond that?

Vinod Bahety:

Okay. Let me address to the first question. And in terms of your other financial assets, let me

just figure out. So other financial assets, this is closer -- so the numbers which I have right now

with me, which is 18, this is the one probably what they're referring to. Just a sec, Indrajit.

Indrajit Agarwal:

Yes. I'm looking at the noncurrent part.

Vinod Bahety:

With me. So there is an increase in terms of the government grant, which is close to overall

increase of INR109 crores. Then there is -- basically, it's more about the fixed deposits, which

are getting reclassified between current and noncurrent. So there are 2 components here. One is

the fixed deposits. So like from an accounting perspective, if it is with remaining maturity of,

say, more than 12 months, then it gets classified as noncurrent.

So this purely is like an accounting reclassification. But otherwise, then from a government grant

receivables perspective, which is also lying here, which is close to about, say, INR109 crores.

That's how it is.

Indrajit Agarwal:

Okay. This is clear. And on the ACC pipeline of capacity expansion?

Vinod Bahety:

Some of these accounting reclassification queries, what I proposed to the team between, say, 4

to -- between 4 to 6, 2 hours also, Deepak and team will be available for any specific questions

on accounts and some details, they will be available. The team will be available to give you the

answers, okay?

Indrajit Agarwal:

Okay.

Vinod Bahety:

So Deepak number is available to all of you.

Indrajit Agarwal:

And sir, on ACC grinding expansion, is it part of 140 or beyond that?

Vinod Bahety:

No, no, everyone is very much part of the 140. Right now, my entire capex program is adhering

to 140.

Moderator:

The next question comes from the line of Navin Sahadeo from ICICI Securities.

Navin Sahadeo:

Great commentary indeed, very assuring. Two questions. One is that of the total promoter fund

infusion, which was sum of INR20,000 crores, post the -- I think the Orient deal and of course

Sanghi, the entire cash deployment is largely done. And also, I think a couple of months back in

one of your maybe media interviews, you did mention that Ambuja will focus on more on

organic expansions now.

So from that perspective, having deployed the cash and the recent -- I mean, the interview, which

I may be mentioning, in general, your view, can we say that the competitive intensity in the

industry can be expected to get soften a little bit from here on and overall industry profitability

could improve? Or you think that no, there is still room for more M&As and hence, it can be

remain volatile?

Page 13 of 21

Vinod Bahety:

Navin, very interesting. Thanks. So in fact, the promoters infusion of INR20,000 crores -- and

Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

as you know, sum total of all our acquisitions so far after Ambuja and ACC, the enterprise value

is almost INR25,000-plus crores. Therefore, in fact, we have also used the existing cash and cash

equivalent for the overall, say, acquisitions, and we are also sitting on a good level of, say, further

for the growth prospects.

Now so far as the prospects for the industry is concerned, I would say more than the action of,

say, M&A, I think overall demand levers are better in terms of the government spending. The

overall cost initiatives for the mature companies who are -- whose balance sheets are basically -

- have the strength to invest will be better, they will have an arbitrage. Therefore, the prospects

of the industry definitely looks better.

And to me, FY '26 should be far, far better than FY '25. In fact, FY '25, if you slice it, the first 9

months and the last, say, 3 months, you will find the key differentiations already and that March

'25 quarter is also spilling over to now, say, June as well. Therefore, I think the prospects are

better. And with the discipline of, say, overall cost and also the uptick in the demand.

And as I said in my commentary that the premium cement, the overall aspirational demand

coming for the good brands, it is there. And with -- and when I look at my brands and my team's

strength, they are focusing a lot in terms of the ground network and overall leading technology

and digitization.

We will differentiate and they will actually augur me very well in terms of the growth versus the

industry. So these are like the trends which I am going to look at it. And yes, my focus will be

more in terms of the organic growth to achieve this 20 million ton additional, which we are

expecting in '26, but not that we are averse to any M&A if it is coming at the right opportunity.

Navin Sahadeo:

Understood. My second question was then about the ramp-up of the acquired units of both Penna

and Sanghi. And Sanghi, if I understand, it's still -- utilization is still under 60% in the peak

quarter like March, having acquired -- I think it's almost the fifth quarter for that entity. So if

you can just throw some light as to how we can see the ramp-up for Sanghi going ahead? And

of course, how is Penna doing so far in the ramp-up there?

Vinod Bahety:

Penna, I would say we are so happy with the assets of Penna. In terms of my clinker utilization,

it is almost 75% to 80%. So far as cement is concerned, the south markets have been sluggish.

Therefore, in terms of cement capacity, it may be a little lower than what the clinker capacity

has been -- utilization has been. But clinker is doing great from Penna perspective.

So far as Sanghi is concerned, you are right that compared to our own target, we may be a few

months behind because more so that it's an island plant, and therefore, we will have to take care

of some of the requirements in terms of the power and in terms of the dredging. And these, like,

plants have been, like, not so well maintained.

So it has gone into refractory linings and so on and so forth, I think. But as of now, both the kilns

are up and running, and you will see a significant -- already I'm seeing it in the month of April.

Sanghi for me is one of the best assets in terms of the cost. It will be my jewel, I tell you, in

terms of the overall clinker cost. It will be my hub of clinker.

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

So Sanghi, for example, it takes time because these are the assets which are sitting on 1,000

million tons of limestone. They have their own typical issues, which are getting addressed. So -

- but as a strategy, Sanghi for me is going to be very important. And this year, you will see

significant capacity for Sanghi in terms of utilization.

Moderator:

The next question comes from the line of Prateek Kumar from Jefferies Group.

Prateek Kumar:

Congrats for the results. My first question is on your capex and cash flow position. So your cash

flow was INR10,000 crores. So after Orient Cement pay down, what will be the cash position in

April? And is there open offer? What is the timing of that? And overall cash also related to

Orient Cement, what is the expectation?

Vinod Bahety:

Okay. Thank you, Prateek. So in terms of open offer, we have already deposited the entire

amount under open offer closer to around INR2,000 crores into SEBI escrow, and we are

expecting the SEBI's clearance of the detailed letter of offer, so that it will move faster. That is

one on the open offer. But in terms of the investment, it's already put into the SEBI escrow.

So far as the overall cash flow is concerned post Orient, and as you know, that Orient, we have

acquired 46% at closer to overall outflow of around INR5,500 crores, INR5,600 crores. After

that, I'm sitting almost now on, say, INR5,000 crores of cash, and this is getting added with

improved operating performances every passing month.

On top of it, we also have some of the areas of incentives and some of the taxes which have

already got in our favor. So we are sitting on a good level of projection for the cash flows. And

therefore, my entire capex for growth will be self-funded and on top of it, I will be sitting on a

decent level of closing cash and cash equivalents. So from a cash perspective, we are fairly in a

decent position as of now.

Prateek Kumar:

So including as an offer payment second, your current cash position would be expected INR500

crores. Your annual capex expectation is around INR10,000 crores outside of that.

Vinod Bahety:

No. So I did not -- I could not hear it properly, but your point is whether your open offer amount

is outside INR10,000 crores or within -- it is part of this overall, say, INR10,000 crores. Like in

April, we have already put into SEBI escrow. So it is part of this INR10,000-odd crores.

Prateek Kumar:

No, no. I meant organic capex is over and above this INR5,000-odd crores which is paid towards

Orient Cement, right?

Vinod Bahety:

Yes, yes, of course. My organic capex is over and above that, of course.

Prateek Kumar:

Right. And just one last question on the…

Vinod Bahety:

And that is what I think that we are operating will be met by the existing cash-and-cash

equivalents, then recovery of the working capital block and on top of it, my monthly improved

operating cash flows coming from the business.

Prateek Kumar:

Right. There is some question on the cost, sir…

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

Moderator:

Sorry, Mr. Prateek, those were your 2 questions. I would request you to call back into the queue.

Vinod Bahety:

Your voice is not clear. I'm not able to hear properly. Yes, sorry, yes, over to HDFC because I'm

not able to hear his voice properly. There is some disturbance.

Moderator:

The next question comes from the line of Parvez Qazi from Nuvama Group.

Parvez Qazi:

Congratulations for a good set of numbers. So just one question. What would have been the

contribution from Penna and Sanghi in terms of volumes in Q4?

Vinod Bahety:

So in terms of volumes of Penna and Sanghi, so far as Penna is concerned, Penna's volume

together, I would say, like both together is around 1.6 million tons for the quarter of March '25.

There is a mobile -- there is a disturbance again. Can you, someone, switch off the mobile also,

please? Yes. So around, say, 1.6 for the quarter, but as I said no, this will ramp up substantially

with Sanghi coming into its fullest avatar.

Moderator:

Parvez, there is a disturbance at your end. Could you please move to a quieter area? Parvez, are

you there? I hope that answers your question.

Parvez Qazi:

So, see, 1.6 is for Penna or Sanghi? I'm sorry, they both…

Vinod Bahety:

It is both together. I will not give you specific details, but it is for both together, it is there. I can

come back to you with specific, but on an overall basis, it is 1.6.

Moderator:

The next question comes from the line of Sumangal Nevatia from Kotak Securities.

Sumangal Nevatia:

Sir, the first question is on the capex. Can you just share for FY '26 and '27 for our existing

ongoing, what would be our organic capex? And broadly, if one could split between projects --

not projects, but on expansions on WHRS, on overall renewable, some breakup?

Vinod Bahety:

Sumangal, in terms of capex, let us say the growth capex is closer to around INR6,000 crores.

And so far as my efficiency capexes are concerned, let us say, between INR2,500 crores to

INR3,000-odd crores, so we are looking at closer to, say, INR9,000-odd crores. Some of them

are discrete and some of them are ongoing.

So as you know that -- and I mentioned to you around 18 million tons of cement, which will be

coming. So one component of this capex out of this INR6,000 crores capex will be that part.

Now so in terms of my efficiency capexes, it will be primarily with respect to the WHRS, the

BCFC rates. In terms of my growth capexes, I mentioned to you about the geos, which we are

looking at to achieve closing or commissioning this year and some of the clinker units.

The clinker unit will be Bhatapara, Maratha and Marwar Mundwa and also the Mundra. So the

Mundra petchem also is now progressing very well. So these are the 4 lines of clinker. And in

terms of grinding, Warisaliganj, Naultha, Salai Banwa, Bhatinda, Raigarh, these are all part of

the 140 million tons of capacity. And couple of more will also come. This is the progress which

we achieved in terms of the land acquisitions and all. So this is in substance about the capex for

FY '26 expected.

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Ambuja Cements Ltd., ACC Ltd. and Sanghi Industries Ltd April 29, 2025

Sumangal Nevatia:

Okay. And sir, maintenance will be around…

Moderator:

Sorry to interrupt, Sumangal, that was your question. I would request you to fall back in the

queue for more questions. Thank you.

The next question comes from the line of Ashish Jain from Macquarie India.

Ashish Jain:

Sir, on the capacity for ACC, which -- the clinker capacity, which you think will be dismantled,

what is the total capacity for the 3 plants put together? And the second part of the same question

is then versus the 89 million ton clinker capacity that we are indicating in the presentation, does

it include any further expansion which is currently not listed there? Or the real number will be

lower than 89 once you scrap the 3 plants?

Vinod Bahety:

No. So in terms of -- let us first address in terms of the capacity for, let us say, Wadi I, it is

around, say, 1 million tons. So far as Bargarh is concerned, also like 1 million. And so far as

Chaibasa is concerned, around 0.6 million. So altogether, say, 2 or 2.5 million. And when we

say 89 million for FY '28, this is already after factoring in this -- basically reduction of these

capacities. This is part of the whole plan of 140 million tons journey.

Ashish, does it answer your question?

Ashish Jain:

Yes. Sir, it does.

Moderator:

The next question comes from the line of Shravan Shah from Dolat Capital.

Shravan Shah:

Yes. Sir, 2, 3 things. First, the INR3,650 cost reduction that we are talking, what's the number

for fourth quarter for that or maybe for FY '25?

Vinod Bahety:

So far as the fourth quarter number is concerned, we are actually at closer to INR4,250 a ton,

right? So we are -- in a way, we should be higher of, say, around INR500 as of now. But this is

like a variable which keeps moving. So this INR4,200 is what we'll be moving to INR3,650 with

all the investment what we are planning to.

Shravan Shah:

Okay. Got it. And second, on the incentive part…

Moderator:

Sorry to interrupt. Following that question, I would request you to fall back into the queue for

Sanghi Industries Limited has informed the Exchange about Transcript on earning concall held on 29th April 2025 on the Audited financial results of the company for the quarter and F Y ended 31st March...

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