SANGHIINDNSEQ2FY26November 03, 2025

Sanghi Industries Limited

9,052words
83turns
9analyst exchanges
2executives
Management on call
Vinod Bahety Mr. Rakesh Tiwary Chief Executive Officer Chief Financial Officer Mr. Deepak Balwani
HEAD, INVESTOR RELATIONS
Nirransh Jain
BNP PARIBAS SECURITIES MODERATOR
Key numbers — 40 extracted
107 MT
tions to the best in the industry. What a quarterly performance! Existing capacities increased to 107 MTPA in quarter 2 with EBITDA reaching 1,060 PMT. The total target capacity is now set at 155 MTPA a
155 MT
to 107 MTPA in quarter 2 with EBITDA reaching 1,060 PMT. The total target capacity is now set at 155 MTPA among other several notable updates. We are pleased to have with us on the call Mr. Vinod Bahet
INR1,060
d in differentiated volume growth and improved realizations, thereby helping us achieve EBITDA of INR1,060 per metric ton, a jump of 32% Y-on-Y, while EBITDA margin stood at 19.2%, uptick of 4.5% compared
32%
nd improved realizations, thereby helping us achieve EBITDA of INR1,060 per metric ton, a jump of 32% Y-on-Y, while EBITDA margin stood at 19.2%, uptick of 4.5% compared to last year's of 14.7%. This
19.2%
s achieve EBITDA of INR1,060 per metric ton, a jump of 32% Y-on-Y, while EBITDA margin stood at 19.2%, uptick of 4.5% compared to last year's of 14.7%. This quarter has been noteworthy for the cement
4.5%
A of INR1,060 per metric ton, a jump of 32% Y-on-Y, while EBITDA margin stood at 19.2%, uptick of 4.5% compared to last year's of 14.7%. This quarter has been noteworthy for the cement industry.
14.7%
jump of 32% Y-on-Y, while EBITDA margin stood at 19.2%, uptick of 4.5% compared to last year's of 14.7%. This quarter has been noteworthy for the cement industry. Despite the
5%
Our group synergies and efficiency measures have started yielding results. Total costs reduced by 5% Y-on-Y led by Kiln fuel cost at INR1.65 per 1,000- kilo calories, and this is excluding the AFR.
INR1.65
measures have started yielding results. Total costs reduced by 5% Y-on-Y led by Kiln fuel cost at INR1.65 per 1,000- kilo calories, and this is excluding the AFR. If I include the AFR, it becomes INR1.60
INR1.60
NR1.65 per 1,000- kilo calories, and this is excluding the AFR. If I include the AFR, it becomes INR1.60 per 1,000-kilo calories. At INR1.65, excluding the AFR, it is lowest among the peers, and it is li
rs,
becomes INR1.60 per 1,000-kilo calories. At INR1.65, excluding the AFR, it is lowest among the peers, and it is likely to sustain/further reduce with increasing trend of AFR. Exit of FY '26, we are ta
INR4,000
reduce with increasing trend of AFR. Exit of FY '26, we are targeting to deliver total cost of ~ INR4,000 per metric ton, which is 5% reduction from current levels of ~ INR4,200. The exit of September has
Guidance — 20 items
Deepak Balwani
opening
“The total target capacity is now set at 155 MTPA among other several notable updates.”
Vinod Bahety
opening
“Likewise, in FY '27, we aim for a 5% reduction and another 5% in FY '28.”
Vinod Bahety
opening
“So, by end of March '27, we are aiming to hit INR3,800 a ton.”
Vinod Bahety
opening
“And by end of March '28, it would be around another 5%, which will be INR3,650 per ton.”
Vinod Bahety
opening
“With this additional 15 million tons, we now revise our target capacity from 140 to 155 by FY '28.”
Vinod Bahety
opening
“Simultaneously, my clinker capacity also goes up from the current target of 84 million to almost 96 million tons by FY '28.”
Vinod Bahety
opening
“And this, we will achieve in over 24 months.”
Vinod Bahety
opening
“And also, there will be opportunity of setting up the bulk cement terminals.”
Vinod Bahety
opening
“Our FY '28 target, as I mentioned, has been revised to cement at 155 million tons and clinker almost at 96 million tons.”
Vinod Bahety
opening
“Greenfield and brownfield expansions progressing quite well at Salai Banwa, Marwar Mundwa -- sorry, Penna Marwar, Dahej, Kalamboli, Bathinda, Jodhpur, Warisaliganj, all of them will be up and running by end of this financial year.”
Risks & concerns — 1 flagged
So far as capacity utilization is concerned, I don't think that is a concern so far as brands like Adani Cement, Ambuja and ACC is concerned.
— Vinod Bahety
Q&A — 9 exchanges
Q
Sir, the first question is on cost. So, while it's a great reduction in the cost. But just wanted to understand a bit more on other expenses. Because like usually like other expenses per ton as well are dropping in Q2 versus Q1 given that Q2 is a maintenance quarter. Just wanted to understand, like, is it like lower kiln maintenance has happened in Q2? Or is there some other factors like lower advertisement spend and all, which has driven down other expenses?
Vinod Bahety
No. So, Amit, thank you. So, you are referring to so far as other expenses of INR774 a ton versus INR712 a ton. And this primarily, Amit, no, of course, the kilns have gone through maintenance and the benefits of the -- this maintenance will actually come in the coming quarters. Costs, for example, remains a focus area for us, Amit. And therefore, this reduction of almost INR62 per ton comes from the improved synergies and efficiency gains. In terms of -- we have also improved our overall sales promotion and marketing strategies with a very analytics-driven branding and sales promotion, which
Q
Congratulations on a good set of numbers. Two questions. One is on debottlenecking. So, if my memory serves me right, under the previous management, we never really heard ACC Ambuja doing any sort of debottlenecking, while every other company would have thrived on this opportunity. Now in the presentation, you've given 13 locations, whereas I believe you have 45, 46 locations in total. So, just wanted to understand...
Vinod Bahety
Navin, you're not audible, we lost you.
Q
Sorry, I lost, again, and I'll just repeat the question. So, I'm saying that if my memory serves me right, historically or in the previous management, I mean to say, there was never a debottlenecking kind of a thing, which we heard from ACC and Ambuja. And now that we are hearing and congratulations for that. But my question is, it is at 13 locations. So, is it fair to say that this is all that we have identified or given that we have 45, 46 locations, there is more scope. And in the same breath, you said we are adding new kiln -- new clinker lines altogether. So, this is not per se like debot
Vinod Bahety
Yes. Thank you, Navin. I think, debottlenecking in cement, first of all, we should know that how it happens. So, like some of our plants which are having the roller press and with -- sorry, with some of these plants which have the ball mills, for example, you actually put up a roller press also, which will complement with this ball mills, and that actually helps you to have a higher grinding capacity. So, that is like a simplified way of explaining the debottlenecking. Now, this is -- yes, we have identified 13 locations and which would mean that these 13 locations would have the ball mills an
Q
A few questions. So first, continuing on the previous question, you reported around INR70-odd per ton of additional cost on back of both sales promotion. And second, on maintenance. Now how much of this 70-odd would continue over the next two quarters? So that's my first question?
Vinod Bahety
Yes. Rahul, INR70 per ton will proceed now with improved volumes coming from some of these acquired assets. And because we are doing it in a very systematic manner. And therefore, some of the time which -- some of these assets, for example, Penna and Sanghi have taken, now that investments have gone, results will start flowing in. So, far as the brand is concerned, see, that is like a very continuous exercise. And therefore, you will see more benefits coming from it with a higher share of premium cement. So even, for example, when I say that this will be maintained, sustained and improve in te
Q
Congratulations again on a good set of numbers. There's been a lot of discussion about costs, and maybe I'll switch to volume growth. I think you had 20% volume growth in the latest quarter. And obviously, the industry is growing at much less. My question is, how sustainable is this growth? And then secondly, as you sort of go upmarket, go more premium, how are you balancing pricing and volume?
Vinod Bahety
Thank you, Manish. A very interesting question. I would go with the last quarter and the current quarter trend, Manish. Last quarter also, we delivered 20% year-on-year and this quarter also 20% year-on-year. Now in terms of sustainability, I think quite bullish to achieve double-digit growth may not be 20% when the acquired assets mature and therefore, the base goes up. But surely double-digit growth is what we are targeting on strength of the strong brands what we have with top of it, now the Adani brand also getting shipped into it. So far as the whole structure, when it comes to premium ce
Q
Just a couple of questions. On the balance sheet, you did talk about the working capital. Could you just give the bridge of the cash reduction from June until September?
Vinod Bahety
From June to September, Raashi, for example, I have in the investor deck given you that the bridge from March to September, right? March to September. So, if -- can I just refer to the particular page, particular -- yes. So, if you go to the slide number -- this slide is right? Slide 37. If you please go to the Slide number 37, Raashi, over there, there's a bridge in terms of the starting point, which is INR10,125 crores and the closing cash of September, which is INR1,813 crores. In between June, there was this INR2,971 crores and there is this capital market event of acquisition of INR5,910
Q
First question, three parts. Sir, somewhere in the mail, we have written that we will be adopting latest technology on new capacities. And it will improve operational efficiencies. And also it will reduce the average age of plants by 40%. Sir, how should we read into this? One is, if you could elaborate on the technology. The second is on the operational efficiency, what you indicate on heat and power, if you could quantify something? And third, basically, I presume average age of plants, that's only because of the new assets, nothing to do with the old assets? If at all with the old assets, w
Vinod Bahety
Ritesh, one by one. Let's -- first, your question is in terms of the efficiency. These technologies, for example, when we say latest technologies, they are all like the 4 million tons of clinker, for example, when you look at that, the heat factor, the heat consumption comes to almost 680-kilo calories, yes? And compared to that, for example, the existing heat consumption is almost like around 730 kilos to 740 kilos. Now that straight away, for example, this new clinkering lines will give the benefit in terms of the averaging the heat consumption. When it comes to power consumption, I'm aware
Q
Sir, Congrats, sir, on a good set of numbers. I just have a couple of doubts. One is we have done a very good job in ramping up our capacity from the time we've acquired assets, and we are going towards the cost reduction journey. What is be hurry for us to expand very fast given that we are in a very good position where we are and our utilizations slightly dropping because of this?
Vinod Bahety
Okay. Pathanjali, thank you. I think you have a right observation in terms of the growth what we have achieved from 67.5 million when we acquired in September '22 to now 107 million. So, almost like 1 million tons per month is what we have grown. But in terms of ramp-up, I think from beginning on first day of the board meeting we have announced, we will go up to 140 million tons, and we are well on our journey to achieve that. There is quite organized and well- articulated strategy around that. What we have now just added is this 15 million tons of debottlenecking, which will take me to INR155
Q
Thank you. I trust most questions have been addressed. Should you wish to discuss any outstanding query, we are available for a separate conversation from 5:15 PM to 5:45 PM. You have my contact number, please free to call me. Thank you.
Management
Speaking time
Vinod Bahety
34
Moderator
11
Raashi
11
Rahul Gupta
6
Ritesh Shah
5
Navin Sahadeo
4
Pathanjali Srinivasan
4
Amit Murarka
3
Deepak Balwani
2
Manish Somaiya
2
Opening remarks
Nirransh Jain
Yes. Thank you. Good evening, everyone. On behalf of BNP Paribas Securities India, we welcome you all to the Q2 FY '26 Earnings Call of Ambuja Cements Limited. Without any further delay, I'll hand over the call to Mr. Deepak Balwani, Head of Investor Relations. Over to you, sir.
Deepak Balwani
Okay, thank you. On behalf of Ambuja Cements, I'm pleased to welcome all the participants to our quarter 2 FY26 earnings call. 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 uncertainty. We remain committed to further strengthening our disclosure standards and improving the quality of our capital market communications to the best in the industry. What a quarterly performance! Existing capacities increased to 107 MTPA in quarter 2 with EBITDA reaching 1,060 PMT. The total target capacity is now set at 155 MTPA among other several notable updates. 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 valuable insights on the quarterly performance.
Vinod Bahety
Thank you, Deepak. Good afternoon. On my behalf and behalf of my management team, welcome to all joining us for this second quarter of FY '26 earnings call. Wishing you a very vibrant festive season, which has also got extended with our women in blue, winning the maiden ICC Cricket World Cup '25. Likewise, trends, I'm equally jubilant to share the all-around robust performance of Ambuja Cements maintaining a strong momentum. This was driven by concerted branding, marketing and other initiatives thereby increasing our customers' preferences for premium products and a larger vibrancy amongst our dealers and supply chain partners. This resulted in differentiated volume growth and improved realizations, thereby helping us achieve EBITDA of INR1,060 per metric ton, a jump of 32% Y-on-Y, while EBITDA margin stood at 19.2%, uptick of 4.5% compared to last year's of 14.7%. This quarter has been noteworthy for the cement industry. Despite the headwinds from the prolonged monsoons, the sector wi
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