Good morning, ladies and gentlemen. Welcome you all to the Q2 FY 2024 results conference call of Sagar Cements Limited. We have with us from the management, Mr. Sreekanth Reddy, Joint Managing Director, and Mr. K. Prasad, CFO. We are also joined by Mr. Raja Reddy, he's the Company Secretary. We will now start the opening session with the management, with a brief opening remarks from the management, and then will be followed by a Q&A session. I request all the participants to be on a mute mode during the course of the call. I would now like to hand over the call to Gavin Desa of CDR. Over to you, Gavin. Thank you, Manish, and thank you for the introduction. Welcome everybody to the call. We'd just like to add that while some statements made in today's discussions may be forward-looking in nature, and a note to this effect was stated in the conference call invite sent to you earlier. We trust you've had a chance to go through the financials and the communication sent along with it. I would now like to request Mr. Sreekanth Reddy to commence with his opening remarks. Over to you, Sreekanth. Yeah. Thank you, Gavin. Good morning, everyone, and welcome to Sagar Cements earnings call for the quarter and half-year ended September 30th, 2023. Yeah, let me begin the discussions with a brief overview of the market in terms of demand and pricing, post which I will move on to Sagar-specific developments. Overall, we have seen demand remaining more or less steady across the regions during the quarter. Volumes as well have remained buoyant amidst good demand from housing and infrastructure sectors. Pricing, which was somewhat soft during recent times, has seen some improvement across specific regions towards the end of the quarter. Input prices as well have been somewhat benign, although we did witness some spurt in fuel prices during the quarter. Utilization levels as well remained elevated, reflective of on-ground demand. That, coupled with lower input prices, should result in better profitability and margins for the industry. Going ahead, while the visibility with regards to demand and volume offtake remains high, sustained improved pricing environment is needed to help counter the vagaries of the input and the freight costs. Let me now move on to our quarterly performance, where we have seen good recovery during the quarter. Profitability in the previous quarter, as many of you may recall, was impacted by low volumes owing to maintenance shutdown and high inventory costs. Volume growth during the quarter was aided by steady demand in housing and infra projects. Pricing environment, as mentioned earlier, was better on a sequential basis. Higher volumes and better realizations resulted in revenue of INR 587 crore during second quarter, as against INR 475 crore during the corresponding quarter of last year, and INR 540 crore during the sequential previous quarter, higher by almost 24% and 9% respectively. EBITDA for the quarter stood at INR 60 crore, as against INR 6 crore generated during Q2 FY 2023 and INR 31 crore garnered during the sequential previous quarter, higher by almost 955% and 97% respectively. Margins for the current period stood at 10% as against 1% reported during the corresponding period last year and 6% during the sequential previous quarter. Profitability and margin improvement during the quarter was largely on expected lines, as mentioned earlier. Q1 EBITDA was impacted by lower volumes and higher fuel inventory costs. We expect the margin and profitability trend to continue into the second half, owing to benign input costs and better volume growth on account of ramp-up of both Andhra Cements Limited and our Madhya Pradesh and Odisha plants. Also, our strategic initiatives towards increasing the share of green power, usage of electric trucks and wheel loaders, and increased usage of alternate fuels bodes well for rationalization in operating costs over a medium to long term period. In terms of key operational activities, as mentioned earlier, our efforts are directed towards improving the overall efficiency and ramping up the utilization levels of our recently acquired or commissioned units. Jeerabad and Jajpur units are performing as per our expectations, and we believe we will be able to achieve 80% utilization level for Jeerabad and an EBITDA breakeven for Jajpur during the current fiscal. We are also positive of attaining our volume guidance of over 6.2 million during this fiscal. Average power and fuel cost stood at INR 1,626 per ton as against INR 2,062 per ton reported during Q2 FY 2023. Freight cost for the quarter stood at INR 848 per ton as against INR 797 per ton during Q2 FY 2023. As mentioned earlier, we have seen some moderation in fuel and freight costs on a sequential basis. Loss after tax for the quarter stood at INR 11 crore as against loss of INR 44 crore during Q2 FY2023. Mattapally plant operated at 62% utilization, while Gudipadu, Bayyavaram, Jeerabad, Jajpur, and Dachepalli operated at 87%, 60%, 65%, 26%, and 22% respectively during the quarter. As far as the key balance sheet items are concerned, the gross debt as on September 30th, 2023, stood at INR 1,533 crore, out of which INR 1,305 crore as long-term debt, the remaining constitutes the working capital. The net worth of the company on a consolidated basis as of September 30th, 2023, stood at INR 1,628 crore. Net equity ratio stands at 0.8:1. Cash and bank balances are at INR 152 crore as of September 30th, 2023. In summary, we believe that our efforts towards cost rationalization, better product mix, and presence across established and fast-growing markets- p osition as well to create value for our stakeholders. That concludes my opening remarks. We would now be glad to take any questions that you may have. Thank you. Thank you, sir. We will now begin with the Q&A session. A reminder to all participants, you can ask your question by raise of hands in the participant tab of the Zoom platform. We will wait for the moment for the question queue to assemble. The first question is from Shravan Shah. Please go ahead, Shravan. Thank you. Are you able to hear us, sir? Yeah, yes, Mr. Shravan. Good morning. Yeah. The first question is, you mentioned 6.2 million volume that we are looking for this year. In presentation, it was 6 million. Just correct me and also help me. How are we looking at in terms of the Q3 and the Q4 volume? Last time we talked about 1.8 million in Q3 and 2 million in kind of a Q4. Yeah. Mr. Shravan, the small downward revision from 6.4, we revised it to 6.2. I think there is a typo in the presentation. We believe that we should be achieving close to 1.75 million in the Q3. This is taking into account the election notification in Telangana. At the same time, we are targeting at doing 2 million for the Q4, Mr. Shravan. That would be the breakup between four big quarters. We did- Yeah. Close to around 2.5 million for the first half. Yeah. We are targeting and doing around 3.7 million-3.75 million for the next half, Mr. Shravan. Yeah, yeah. Got it. Second, sir, in terms of the pricing, if you can help us in terms of the, from Q2 average. Now, so we understood that in East also there is a close to INR 50-INR 55, the kind of a price hike got absorbed in September, and in South also, INR 30-INR 50 price hike is going on. Just wanted to understand from Q2 average, how are the prices in East and South particularly till now, whatever we have taken? No, I think rather than talking about Q4, let me talk of the exit prices from September to October. Of course, in South, the price increase we could realize only from the second week, though we initiated price increases on 4th to 5th of October, but the real price increases started for us only from second week onwards, Mr. Shravan. Hyderabad, we have seen almost INR 35 per bag, kind of an increase. I would not call of exit of September alone, but from middle of October, we could start looking at a INR 35 increase per bag. We are looking at Vizag, almost the price increase is to tune up around INR 35-INR 45. Bangalore, we have seen around INR 20-INR 25 per hour bag. Chennai, we have seen INR 40-INR 45 per hour bag. Solapur, yeah, we have seen INR 20. Yeah, when it comes to East, yeah, this we could see, well, from end of August itself, we could see almost INR 30 kind of an increase from September to October. October, we could only get an additional INR 5 over that timeline. Indore, one of the markets that we have seen, yeah, we have seen a +INR 50 kind of increase. Sorry, sir, Indore, you said how much? +INR 50, sir. It is from exit of August, September into the October, or at this point of time, we have seen a +INR 50 per bag. INR 50? 15, one-five. 15. Okay, okay, okay, got it. Now, sir, if you look at in terms of what we were looking at, EBITDA of INR 400 odd crore for this year- I think that is achievable, Mr. Shravan. Our outlook, we are very clear that we should be very close to that number. Okay, okay. Just trying to further understand that, because in the first half we did INR 91 odd crore, so we need INR 310 crore kind of a number for in second half. Yeah, on a 3.7 million, sir, we are talking of around INR 800-INR 850 on a very conservative scale. Given the operating leverages that we have and the current fuel price trends, which we believe current fuel prices might remain more or less flat in our case, with the realization jump, we are looking at around getting INR 800 on an average for ourselves. Okay. For second half, we are looking at INR 800. Yes. To INR 850 kind of numbers. Yes. That's great. That's great. Second, on the expansion plans, last time we have talked about three plans that we are having, and maybe we will be sharing the details in this con call. From currently 10 million- 12 million, 0.75 in Andhra, 0.25 in Gudipadu, and 0.5 in Jeerabad. Any update on that in terms of the impact? Yeah, we are just awaiting. We are just waiting for the clearance from our Investment Committee, which we should have over next 15 days, that clearance. As soon as we get the clearance, we'll be happy to revert back. Broadly, that number will remain and- Yes, sir, that number would remain. The target is to reach to 12 million by end of FY 2025, for which we need to initiate as soon as possible. We are just waiting for the approval from our Investment Committee to share it with all of you. Even for the debt also, though, it has increased by close to INR 120-odd crore in H1? We were looking at INR 1,200-INR 1,250 kind of a net debt for next two-odd years. See, I think on the debt, sir, we would remain committed to not crossing on the gross side at INR 1,500, and on net side, somewhere around INR 1,250-INR 1,300. We would not cross those numbers either way. We are committed to keep that number, say, there's even within growth plans for this. Okay. Lastly, on the CapEx, sir, one is we have done INR 130-odd crore, so how one can look at for this year at least? Yeah, we only have the maintenance CapEx, Mr. Shravan. At this point of time, that is the only upward we have, and that is what we have committed to spend. As we have mentioned, Mattapally went through a very deep shutdown, because after 15 years, the kiln and the preheater went through some modifications to handle much higher pool of alternate fuels and also it demanded some maintenance. That is the only CapEx that is earmarked for the next six months. But for the medium-term kind of a CapEx, for which we are awaiting for the Investment Committee to approve, we would only do the maintenance and then march in the. Oh, okay. Okay, thank you and all the best, sir. I have questions. I will come up in queue. Thank you. Thank you. Thank you. The next question is from Rajesh Ravi. Yeah, hi, sir. Am I audible? Yeah. Yes, sir. Good morning, Mr. Rajesh. Hello? Yeah, good morning, Mr. Rajesh. Yeah, yeah. Sir, my question pertains to first, the margin guidance, which you gave for full year, and this is second half around INR 850 versus INR 360 achieved in H1. What are the cost levers that you're looking at out of this INR 450-INR 500 improvement in second half? How much of these would be cost driven? Fuel prices apparently seems to have bottomed out, correct me if I'm wrong. Yeah, Mr. Rajesh, I think in our case, it's, it's a combination of operating leverage. As, as we have mentioned, we only sold 2.5 million for the first half. Here we intend to sell close to 3.7. That itself should add INR 100-INR 150 overall cost reduction on the operating leverage side. We don't expect major changes to happen on the power and fuel from what we have achieved in Q2. Reason is obvious that the pet coke and coal prices what went down aggressively, actually came back. From $100 again, they, they came back to $140-$150 kind of dollars. We don't expect things to be lot more different, but we may have to review at this point of time we do have to but we do have inventory all the way to middle of Q4. But with the geopolitical issues that is happening in Middle East, you would want to keep track of it but having said that power and fuel cost we expected to remain flat. With the balance who come from the generation jump and the- and you know we as mentioned the break-even at both the beta break-even at both and have already happened so even this scenario we definitely expect the margins to to more than double, Rajesh. Okay. This versus Q2, the INR 400 extra margin that you're looking at, out of which around INR 150 is operating leverage driven, and rest INR 200-INR 250 you're looking at from realization improvement? Yes, sir. I think that conservatively is our estimate. Okay. Sir, this Andhra, what is the current Clinker and cement capacity, 1.8 and 1.65? Sir, the current Andhra's capacity is to tune of around 1.85 million is the Clinker capacity, and 2.25 million is the grinding[audio distortion], Rajesh. Okay. This you are expected to take this to 2.3 Clinker and 3 million- Million Grinding by FY 2025, sir. 1.85 Clinker will become 2.3, and 2.2 Grinding will become 3 million tons. Yes. Next, by next. Okay. Great, sir. I'll come back in queue. Thank you. Thank you. Thank you. The next question is from Pritesh Chheda. Pritesh, please go ahead. Sir, the incremental INR 450-INR 500 which you're mentioning, isn't it a bit conservative, considering that even if one takes INR 25 bag, that itself is a INR 500 extra EBITDA per ton? Sir, that is gross. Sir, you have to remove the GST, sir. GST is not. Okay, you're saying at the gross level. Okay. Okay. That was my clarification. The volume that you mentioned in the SEC for the full year is how much, sir? Yeah, we are talking of 6.2 million, sir. You have done 2.5 in the first half, right? Yes. Okay. Thank you very much, sir. What's your peak debt after the expansions? Yeah, we are talking about INR 1,500 on a gross side, Pritesh. Okay. Thank you very much, sir. Thank you. Thank you. The next question is from Amit Murarka. Please go ahead. Yeah, hi, good morning, Sreekanth. Thanks for taking my question. On Andhra Cements, I was just checking the numbers. The EBITDA per ton seems to be same as Mattampally, but with a lower realization. Just to understand, like, is it lower cost, or could you just explain those numbers a bit better? Yeah, it's a more operating leverage, Mr. Amit, because at Andhra we could produce more Clinker, so there was sale of Clinker along with the sale of cement. The operating leverage helped us to have a better margin in Andhra for the last quarter. This year's volume that you've mentioned I think of think 90.95 million tons, so, like, that would include Clinker or no? No, that doesn't, usually doesn't include in Clinker. How much was the Clinker sale there? No. Because as mentioned, Mattampally was under maintenance, so we shifted somewhat of Clinker. It's safe to assume that it will be a combination. I would not say included at this point of time. It again depends dynamically on the market conditions, Mr. Amit. Right. On the overall revenue it is, but on the sales number, we are sticking to the cement sales number. Okay. Okay, understood. Okay, fine. But still, like, the EBITDA that is mentioned there, like, could you just give a sense about how much of that EBITDA was from Clinker sales, just to kind of understand the cement numbers better? See, I think it's like EBITDA, yesterday, EBITDA, you can confirm it's not EBITDA. What percent of EBITDA is from Clinker sale? That's the question, right? Yeah, yeah. Right. Yeah. Yeah, I think we should take it half, half, if I'm not mistaken, Amit, but we will revert back to you with the specifics on that. Got it. Got it. Like, the capacity utilization then was about 40-odd%, right? The cement utilization in the quarter, like, based on the 2.25 million ton. You're talking of consolidated numbers or standalone? No, this is Andhra. Again, Andhra, I'm talking about. See, Andhra, see, Clinker utilization was slightly more than the cement utilization, Amit. We also had to shut down because we couldn't handle the Clinker beyond a point, so we had to take a forceful shutdown. Let us look at the full year number, because the first half, as you know, only the Q2 was the full, reasonably operated kind of a quarter. August month, we actually were very near to 85% at Clinker level utilization. That was only for August, not for October, not for September. It is fluctuating because we couldn't handle the excess inventory, so we had to take a forceful shutdown. That may not truly reflect the operating rates for the first quarter. Full year, our target is to achieve around 0.75 million. I think we are keeping that target for the cement sale at 0.75 million from Andhra for the full year. Okay. Sure. Sure. Thank you very much. Yeah. Thank you. Thank you. The next question is from Shravan Shah. Please go ahead. Sir, just to clarify, sir, when we are saying Andhra 2.25, so that includes the Vizag? No, sir, it doesn't include Vizag landing. Okay. Oh, okay. Regarding the Vizag land sale, any update? Sir, we have time. As clarified last time, we are talking about 18 months, so after that three months is done. We have the... We believe that we should conclude some transaction well within those 15, coming 15 months. Okay. Okay. Not even a broader range in terms of the market values of you? Sir, sir, we are still getting the government. It's work in progress, so we completed only a small portion of the, or probably out of 4 steps, we completed only 1 step, so we have 3 more steps to complete. Once we complete 2 or 3 steps, only then we will start engaging with potential buyers. Because the scope of conversion and everything, we are trying to keep it for ourself. Before that, we need to get the land records and everything structured, and then convert the land, and then seek the government permission for potential sales. These are all the steps that are involved. We only completed the record, the bookkeeping and everything to be in order for us to proceed with the next two steps, which will definitely take 15 months is what we are targeting. We will be very happy to come back to you with the status on it once we have crossed each milestone. Broadly, the ballpark Ready Reckoner would be a kind of a 2.5- The Ready Reckoner, as we have mentioned earlier, yeah, that remains at INR 4 crore per acre. That remains, so that has not changed from earlier quarters. That Ready Reckoner is something which we are looking at the government. Government is yet to revise any of those Ready Reckoner rates. Okay. Okay, got it. Sir, our trade sale for this quarter was how much? It should be close to around 65%. There is a government component. As As you know, most of the governments are gearing up for the elections, so there was definitely government component in the entire sale. Trade is close to around 65%. Okay. Okay, okay, got it. Green sale for this quarter was how much? Last quarter was 27%. See, this time it is very close to that number because I think full operations, we'll only able to do it in the current in the second half, Mr. Shravan, because Mattampally was under maintenance. That component remains reasonably close to that. Most of our inventory was used, so that would not have changed. For the second half, we are talking of close to around 30%. We should reach to that 30% second half. Okay, okay. Even the first generation just started, so that component also will get added.[audio distortion] Good morning, Sreekanth, sir. Yeah, good morning to you, Mangesh. Yeah. Sir, a couple of questions from me. Firstly, any impact on demand after the price increases that were announced? Secondly, with the elections dates being announced, do you feel that demand could turn out to be lower, which would actually drive pricing lower because of lack of demand? Mr. Mangesh, our experience from past 1.5 decade, especially on this price to volume, there has never been a correlation, sir, so I cannot comment much. Very well. Secondly, demand definitely doesn't move with the increase in price, sir. I think, as mentioned previously in my earlier calls too, the cement per se would not be a major cost component in any of the construction activities or the end-user requirements, sir. Okay. Especially on the housing, if you look at low-cost housing, it is less than 3%. Luxury housing, it is definitely less than 1%, but most of the infra projects, it is less than 5%. Given the impact of cement cost- Yes. In the end-use requirement, I don't think the price of cement would influence in a big way the demand. Usually, it will be a major reaction to slow down, just in case if it surges up. This price increase is not that steep for demand to really contract. In Telangana, of course, the election schedule for two states where we are present is for Madhya Pradesh and Telangana. In Telangana, the government influence on the government consumption is limited. The demand, we have not seen any major contraction so far. Madhya Pradesh, we are watching, so we would be in a much better situation to comment on the election schedule's influence on the demand, probably couple of weeks later. As we speak, so far, we have not seen any shrinkage on demand in the Madhya Pradesh, either because of price increase or because of the elections. Okay. Thanks, thanks, sir. That is helpful. Secondly, on the Andhra Cements expansion. During the expansion, do we have to take a prolonged shutdown from this facility? If that is so, when would that be? See, this, we are building a brand new cooler in parallel, so it doesn't demand a major shutdown. At the best, it might need a 30-day shutdown. That is likely to happen 15 months from now. And that can be managed with the inventory management rather than an absolute break in the complete kind of dispatches. It may not really influence the sale. To certain extent, it might influence some cost-related issue 12 months-15 months from now, but not now. Understood, sir. Sir, so lastly, if I may ask, after the increase, have you seen the interregional sales, like, you know, basically the inputs from other regions increase in Andhra or other region? No, fortunately, most of the contiguous regions have. Have also seen that. Not the same, but similar kind of a price increase. That would not really push volumes. We are just two weeks into this, sir, so we will be in a much better situation to understand and revert back to you. Probably it will take another couple more weeks before we could start getting to know the movements, interregional movements in the way. So far, most of the contiguous regions had similar kind of increases. Typically, it doesn't prompt in a big way the changes in the interregional movements. Understood, sir. Thank you and best of luck, sir. Thank you. Thank you. The next question is from Sanjay Nandi. Please go ahead. Yes, sir. Good morning, sir. Thank you for the opportunity. Sir, what has been the utilization for the Clinker for this exit quarter of Q2 on a consolidated basis? I think we are close to around 65% at a group level, yes. 65%. Okay, sir. Sir, last question is like, what is the average holding period for Pet Coke inventory? Like, do we book something when the price is $200 or under $10 per ton? Sir, we do it irrespective of the price. The only time that we held back was when it was at a very, very elevated level, when it was above INR 200+. But now we keep buying systematically. Our historical holding was almost close to six months. That got revised to four to four and a half months right now. So we are still sticking to that because we believe if there are any changes, we may not be in a situation to get benefit out of it. So we have limited ourselves to 4 months-4.5 months right now. Okay. Thank you so much, sir. Thank you so much. That's all from my side, sir. Wish you a happy Diwali in advance. Thank you. Wish you the same. Thank you. The next question is from Keshav Lahoti. Please go ahead. Hello, good morning. I just want to understand, Andhra phase two was expected to start in H2. You more sounded like this year would be more of a maintenance CapEx only. Whether that would be delayed? No, Mr. Keshav. No, Mr. Keshav, let me again for clarity sake, we are talking of maintenance CapEx at all the places. Investment Committee is reviewing the proposal, what we have circulated. As far as Andhra is concerned, yeah, that is, we get approval, we should kickstart it at the earliest, but that may not lead to huge CapEx, because in initial phase, it doesn't consume much. It's more to do with the advances, Mr. Keshav. That should not delay. We are just waiting for the Investment Committee to give the clearance. That's what we have committed. At this point of time, since we are waiting for the Investment Committee to clear, we have committed only for the maintenance CapEx at the rest of the places. Once the Investment Committee clears, we would be happy to come back to you with the clear CapEx plans, but it may be very, very small for the current year. That should not delay the overall kind of a CapEx plan, because we are only going to pay 10%-15% of the overall CapEx, the expansion or the modification CapEx. So 10%-15% is going to be the commitment for this quarter. That may not be much. That's what we have said, and that's what I'm trying to clarify here. Understood. Broadly, the understanding is the CapEx would be something like INR 300 crore, so maybe INR 30 crore-INR 40 crore might be incurred in this year and balance next year, and this project will be completed by FY 2025 end. No, I would like to stick to that, but since I'm waiting for the clearance, we would be happy to come back, sir. Probably we would be very happy to come back as soon as we get the clearance, but it will be broadly a similar kind of alliance as we have mentioned. Okay, understood. Andhra Clinker was like 1.65, what I remember, but today you mentioned 1.85. No, it is always 1.85, sir. Grinding was 1.65. Okay, okay. It was limited to 1.65. There was investment made by the earlier management itself of pre-grinder and all, which they did not commission. Yeah, we ended up commissioning that during the takeover and the ramp ourselves. With that, the Clinker capacity remains at 1.85, but the grinding from 1.65 moves to 2.0. Understood. Understood. One last question from my side. What was the Jajpur sales volume in Q2, and are we on a target to achieve 40% utilization for this plant in this year? For the first half, yeah, we did close to around 0.14 million, sir. Our target is to do 0.4 million, so I think we should end up achieving those targets at Jajpur. Okay. Thank you. That's it. Thank you. Thank you. The next question is from Krutika Vispute. Please go ahead. Yeah. There was an announcement yesterday from the exchange to do with the AvH Resources and some special rights with, you know, shareholder agreement. If you could throw more light on that? Yeah. Krutika, can you repeat the question, please? Yesterday there was an announcement where you had referred to a shareholder's agreement with AvH Resources, and there were some special rights mentioned. If you can talk more about that, what exactly does that- Yeah. See, it is pertaining to getting shareholders' approval for entering into shareholder agreement with AvH, who has been investor for over 15 years. We are formalizing the relationship by entering into a shareholder agreement with them. Formalizing as in any what sense? Yeah, there was never a shareholders' agreement between Sagar Cements and AvH, so we are entering into a shareholders' agreement with them right now. They hold close to 19.8%. Right. We are getting into a shareholders' agreement with them. Okay, and what are the special rights that the announcement refers to? Yeah, Krutika, can you- s orry, I missed out. Your voice is very feeble. Yeah. I'm saying what are the special rights that the announcement refers to? There are nothing. It is exactly on a similar line as we have entered previously with the previous large investors like Premji. It's like appointment of nominee directors. See, we are a listed company, so you know, the things are pretty clear. It's more specifically getting, formalizing the shareholder agreement with them. Okay, got it. Yeah. Okay, okay. Thank you. Thank you. Yeah, that was my question. Thank you. Thank you. Thank you. The next question is from Shravan Shah. Please go ahead, Shravan. Sir, just to again clarifying, what's the current total grinding capacity? Is it 10.85, 10 or 10- It is 10.85. It is 10.85, Mr. Shravansh. Okay. Okay, because it is actually not telling, so that is some. Yeah, I'm sure there are some small gaps. It is 10.85. Okay. Okay, got it. Thank you. Thank you. Anyone who has a question may please indicate by raise of hands. In the meanwhile, a couple of questions from my side. What is the current status in ramp-up of both the plants, both in Dhar as well as in Jajpur? Yeah. Dhar, our capacity utilization is up of 85%, Mr. Manish. The run rate is very good, except for this year, last couple of months, where the season did impact. The run rate is up of 85% capacity utilization. As far as Jajpur is concerned, as you know, these files have improved and the merger is complete. With the both these events, we are ramping up. The capacity utilization is near 50% at Jajpur as is. See, and in terms of break-even, we were. We already broke even during the middle of last quarter itself at EBITDA level. Okay. We are talking of Jajpur. Jeerabad, of course, it is more than breakeven. I think it is into profits. Manish, and we are also very happy to announce that the government, the Madhya Pradesh government approved the incentives. It was 40% of the certified CapEx, which should have been or INR 150 crore, whichever is lower. It should have been 180, but since the cap is at INR 150 crore, so we got a sanction for INR 150 crore incentive to be paid over 7 years. It will be equally paid at 21.5 kind of a number per year for next 7 years. We did receive the sanction of incentives also at Jeerabad plant. Okay, so that's approximately like INR 200 a ton. Slightly more than that number. Slightly more. Slightly more than that number. Okay. Okay, got it, sir. Sir, and in terms of from the demand perspective, can you give your usual commentary on state-wise demand outlook? See, I think I would rather stick to the South. Demand would definitely be up in a very high single digit, which we stated. The reason why we are talking of a single digit is election notification has come for Telangana. Given that scenario, though we don't expect a major slowdown, but it would definitely impact the labor availability and all for some time. Given that scenario, we believe that the entire South, which so far has moved close to 12%-13% for the first half, yeah, we believe it might end, we might end the year with a very high single digit or maybe a very low double digit kind of a number for South. Rest of all the other places, we believe like Odisha would be single digit, high single digit. Madhya Pradesh, we expect again from a double digit, we recalibrate it to single digit again because of the election vote. Got it. Thank you so much, sir. The next question is from Sumangal Nevatia. Please go ahead. Yeah, thank you, sir, for this chance. Sir, I joined the call late, so if it is repeated, please excuse me. One is, on the Andhra Cements, we are holding 95% holding. What is our plan? I mean, what is the compulsion as far as the regulation is concerned, and how do we plan to dilute over the next 1 years-2 years? Yeah, the regulation is for us to reduce it to 90% first, less than 12 months from the day of listing. That means we should reduce it by 5% before April 2024. Within three years' time, we have to reduce it to 75. Okay. We are bound by those regulations, so we would invariably fulfill those obligations at the right time. Okay, any initial thoughts as to what is our preference in terms of route of obligation? See, our approach is not to sell Sagar shares, but to go for a capital increase, because we are a growing organization, so we believe that there is CapEx and there is a requirement. We generally don't go for a high, very high leverage, so we would like to balance that. Our preference is to go for a capital increase at Andhra for complying with the regulation. That's clearly stated. Yeah, we should initiate probably a month, month and a half from now about looking at those options, which is we want to complete the first step first. We should start the work pertaining to that over the next couple of months. We are more than hopeful to fulfill those things ahead of time on a regulatory compliance. Got it, sir. That's very useful. Second question, I mean, at a 12 million ton capacity, what sort of maintenance CapEx should we expect? And next year to reach to 12 million ton, what sort of CapEx broadly for FY 2025 are we looking at? Yeah, Mr. Sumangal, pertaining to reaching to 12 million, the CapEx, we would revert back to you, except for the maintenance CapEx. Yeah, we are waiting for our Investment Committee to clear the CapEx plan. We are expecting anytime now. As soon as we get, we would be happy to share that. From a maintenance CapEx perspective, when we reach to 12 million, sir, you should expect INR 50 crore per year on an average year. Got it. Got it. Sir, last question, given that this year for Andhra, we'll be at less than 1 million tons volumes and with a capacity of more than 2, so next year, incrementally, could we look at another year of very strong volume, irrespective of a normalized year as far as industry is concerned, given a very low utilization both at standalone and Andhra? Yeah, Mr. Sumangal, the current year, the outlook is to do 0.75 million from Andhra for the current year, because we only started during the Q2. The operations generally started only in Q2, so we only had 3/4 of a year. Next year, we expect the volumes to move to anywhere between 1.25-1.5. We would be doubling the Andhra from 0.75 outlook. Our target is to achieve 1.5 million for next year. That adds up along with the ramp-up of Jajpur. Rest of all the other assets, we believe that we should be doing very similar kind of a run rate, given the next year is going to be a big election year. Both in Andhra as well as in the central government, and some of the operating areas, we do have the elections. Given that scenario, yeah, we believe the other assets other than Jajpur and Andhra Cements to perform exactly like this year. We do expect the volumes to slightly be more relative to this year from Andhra and Jajpur. Okay, sir. Ballpark 7.5-8 is what we should pencil in for next year? I would be around 7.5 million on my estimate. Okay. Okay, sir. Got it. Okay, thank you so much, sir, and all the best. Thank you, sir. Thank you. The next question is from Rajesh Ravi. Please go ahead. Yeah, hi, sir. This incentive from M.P. government, this will be a capital subsidy, or will it flow through P&L revenue? It will go through P&L, Mr. Rajesh. This is irrespective of volumes, or it is? Yeah, it has nothing to do with the volumes, Mr. Rajesh. This will do with the CapEx, but structured in a way where it will go through P&L, so it is irrespective of volume. This fixed INR 150 crore will be paid over seven years, so it's going to be a lump sum, INR 21.5 kind of a number. For each year. Irrespective of volume. You will start accruing this Q3 onward? Yeah, we should start accruing from the current year onwards. So no annual without- Rajesh, we are going to account based on the receipt. Based on receipt, okay, that's clear. Yes. Whenever we are going to realize the money, then we are going to- Only that we are going to. Okay, okay. There's no accrual you are following over here. Yeah, and for the disbursement, there is a limitation on the capacity utilization. Yeah, the limitation is that 70% capacity utilization. If suppose if it is below 70%, proportionately they are- Proportionately, they are going to organize the usage. Okay. Yeah. Yeah. Okay, okay. That will be paid off later when they utilize? Yes, sir. It is- see, INR 150, INR 60, that's paid over 7 years. Okay. In case she is that we have to operate it minimum at 70%. Okay. Sir, this volume guidance, 6.2. First half, we have, you know, 2.5, which you have done around. If I remove the Andhra, which is around 2.4 million, and next 6 months, you're looking Andhra to volumes to contribute another 0.65 million, ex-Andhra, the remaining assets, like the standalone, you're not looking any volume uptake? Sir, we should be cautious in- w e stated that even before, Mr. Rajesh, that the existing assets, we only factored in 2.5%-3% kind of a growth, so that remains at that level. Given there is that small supplies that are coming to the regions that we operate, and the demand is likely to grow only in single digits, we have penciled in not much of a growth for the existing assets. The bigger ramp-up is happening both at Jeerabad as well as Rachpally. In the coming second half, we are expecting 1 million-1.5 million to be contributed by only these two units. Yeah. Okay, sir. Just one last question. You know, when we see the standalone three, you know, two subsidiaries performance, where they have reported almost INR 700-INR 800 margin, is it that most of the fixed cost is getting reflected in the standalone entity that would have also, you know, benefited the other way? No, no, sir. I think what you should understand is the Mattapally, which is one of the largest in the standalone, was for maintenance. First half is one-off kind of an event that has happened there, Mr. Rajesh. But for that, I don't think there is any anomaly in it. I think operating leverage is across. Once we do better, I think the spread is going to be equally impactful, yeah. Andhra is an exception because Andhra, yeah, we had Clinker sale and cement sale, and most of the footprint areas of Andhra remains in a close proximity, so the realization is lot higher. But for that, I think it is across various. Just one follow-up on this because if you look at this Andhra, where such low utilization, they have delivered healthy margins, and when you're looking at much higher volumes in the second half, obviously you will have a, you know, better operating leverage. In this Yes, sir. That is one of the reason why we are talking of almost 3x the number for second half compared to the first half. Correct. The standalone, where you had maintenance impact in the first half, even that should be. Yes, sir. I think this is what is making us be very clear about the outlook when it comes to margin, Mr. Rajesh. Yeah. Along with the realization increase, we did factor around INR 100-INR 150 to come from the operating leverage itself because we don't have any major maintenance issues or this thing that is likely to come up for the second half. That itself should help us add up INR 150 on cost side, or rather reduce INR 150 from cost side, which should add up to the margin, and the rest is what we are expecting from the realization increase, Rajesh. My thought was that would not the operating leverage and the cost benefit should be much higher, given that both the standalone. Sir, we are in cement, so I need to be cautious because we need to factor many things, and we are into the election year, so any notification or any of that, and at the same time, geopolitical issues would always have. In fact, the power and fuel, which is very, very sensitive to those events. Great, sir. Thank you, and all the best, sir. Thank you. All right. Thank you, Mr. Rajesh. Thank you. The next question is from Vishal Periwal. Please go ahead. Yes, sir. Thanks, sir, for the opportunity. Sir, now that, you know, cement demand, since it has been strong and now we have taken industry-wide, the price hike has also happened. Historically, given your past experience, has both these things gone parallelly for consistent period of time, or one comes off, like, you know, after a brief something strong seasons? Sir, again, I have to go back and give you a historical kind of an impact. Over last 13, 14 years, since the South supply has been 2x of demand, we have seen price increases coupled with reduction in demand. Sometimes we have seen price increases with increase in demand, so we have seen various permutations and combinations. There is never a one single rule that was applicable. But there were instances where price increase was coupled with increase in demand, so nothing can be ruled out in us. Okay. For absorption of this price hike, typically you will wait for how many weeks to say that, okay, things are sustaining? Two weeks. Typically, we have to wait for the two weeks, sir, which we just completed, so that's what makes us think that this price at least would sustain in this present year. Though this hike is not the highest, I don't think we are at such high prices that we have seen in the past. Most of the people are excited with this price increase, but I think this price increase just manages most of the cost from small single-digit EBITDA margin, I think we will be reaching to 15%, sir. The real requirement is above 18% EBITDA requirement for all of us to survive and service the stakeholders. There is a gap, so we believe that prices still have to move up. But we have to- Since the last 1.5 years - 2 years, we struggled to increase the price, so we would want to go cautious on these issues. Coupled with the election, if this current price increase sustains, it would give some relief, but this alone is not enough. It should go up further, by in our view, another 2%-3% at large level, for industry to have a reasonable margin for it to sustain and service all its stakeholders' aspirations. Okay. Yeah, sure. That's all from my side, sir. Thank you. Thanks. Thank you. The next question is from Shravan Shah. Please go ahead, Shravan. Sir, this incentive on the M.P., so first to clarify, do we have any other incentive apart from M.P., which we currently are booking or likely to get? Sir, we only book on receipt, sir. We have quite a few incentives that needs to come, so none of them are booked, like especially in Andhra and Telangana, where we have close to INR 75 crore-INR 80 crore of receivables from the government or as incentives, but that has been due for over more than a decade. Till we receive, we generally don't book. Other than this, INR 150 crore is available from Madhya Pradesh. That also is due over next 7 years[audio distortion]. Yeah. There, just to clarify, we are looking at close to 0.4 million ton volume this year. No, sir. Sir, in Madhya Pradesh, we are looking at 0.8 million. The target is to be at 0.85 million. I think we should be fulfilling the target there in Madhya Pradesh. We did for the first half, yeah, we did more than 0.37. For the next half also, we are looking at slightly more than this number, at 0.45 million or 0.5 million. I think that is definitely achievable, yeah. Okay. Got it. Got it, sir. Thank you. I, I mistakenly, uh, uh, took the number for- Just, yeah. Yeah. Got it. Thank you, sir. Thank you. The next question is from Rajesh Ravi. Rajesh, do you have a question? Sir, my questions are all over. Thank you. Okay. Thank you. As we don't have any further questions, may I hand over the call to Mr. Reddy for his closing comments? Thank you, Manish. We would like to once again thank you, thank you all for joining us on the call. I hope you have got all the answers you are looking for. Please feel free to connect with us at our team in Sagar or CDR if you need any further information or if you have any further queries. We will be more than happy to discuss with them. Thank you again. Happy Dussehra and happy Diwali. Thank you, sir. Have a good day. Thank you, sir. We now conclude the call. You may now disconnect. Thank you.