Ladies and gentlemen, good day and welcome to the UltraTech Cement Limited Q2 FY 2024 earnings conference call. We must remind you that the discussion on today's call may include certain forward-looking statements and must be therefore viewed in conjunction with the risk that the company faces. The company assumes no responsibility to publicly amend, modify or revise any forward-looking statement on the basis of any subsequent development, information or events or otherwise. 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. Atul Daga, Executive Director and CFO of the company. Thank you, and over to you, Mr. Daga. Good afternoon, good evening, everybody. Welcome to the second quarter earnings call for UltraTech. With me, I have my Managing Director, Mr. K. C. Jhanwar, and my colleagues from my finance team, so that any questions that arise can be answered fully. Let me start by saying, talk a bigger picture about cement as an industry. I personally believe cement is not for the weak-kneed people. Go anywhere in the world, it's a long-term story, connected to the fundamentals of the economy. So if you are looking for a growth story, then emerging markets cannot be ignored. And within emerging markets, I'm sure everybody agrees that India is the fastest growing large-sized economy, and then that's the place to invest in. If you're investing in India, then infrastructure sector is surely generating growth, which is likely to see investments. For infrastructure, cement is one of the key pillars for growth. Let me now jump on to the burning topic of costs and how it has been impacting the industry. When Russia war started, coal shot up to close to $400. Pet coke was close to $260. We have seen ups and downs from there, and it is not prudent, according to me, to analyze the cost from a given date. Input costs are never static. Every day can be different. Pet coke costs floated with about $100 mark for a very brief period in the first week of June or somewhere around that time, June or July, and now have climbed very rapidly. They climbed back to $140. Whoever was able to book shipment in that period will probably have a short honeymoon in Q3. Besides, coal or power and fuel is not the only cost driver. Second quarter is always a very high maintenance cost quarter for cement industry. At UltraTech, we had almost 24 kilns under shutdown, maintenance shutdown, which is a routine operating parameter. Besides, we are still celebrating our 100 million tons of production dispatch in sales in one financial year, which happened last year, for which a one-off special bonus was given to the employees, amounting to almost INR 40 crore. I thought of calling it out as a one-off. And we have to wait and watch how crude behaves given the global scenarios that are emerging. Similarly, selling prices also are, also keep fluctuating. With the recent price hikes that have happened, it's definitely a good thing to have on the P&L, but I believe it should be a wait-and-watch game. Given the pressure on costs, we expect that the prices should hold unless some companies are not able to sell at a higher price and, you know, they start faring differently in the markets. As of today, so beyond the quarter ended September, I would definitely want to highlight how the prices are shaping up. With comparing to the exit of June, all India prices are up 7%-8%, which was about 3%-4%, 3% or thereabouts, from June exit to September exit. But if you were to look at the quarter average prices, quarter average prices were marginally up 1% or 1.5%, over the previous quarter. Each region has been experiencing good traction in prices, and as we speak, currently, all the prices are holding steady. We have seen price increases, now depending upon the comparative period. I am looking at comparison over June exit. The prices in East are almost up 7%-8%. Similarly, Maharashtra is up 7%-8%. South would be maybe 5%-6%. North, again, 6%-7%. Central is perhaps flat at the moment. Let me now quickly touch upon our expansion. The 22.6 million tons capacity expansion, which is in progress, work is going on full swing. We are confident of meeting our timelines. In addition to the 22.6 million tons of capacity that is ongoing, we are adding three more slag mills, totaling to 1.8 million tons, which will get commissioned along with this 22.6 million tons. So effectively, the second phase of growth will be 24.4 million tons. At the end of this second phase of growth, we should be reaching 159.65 million tons of capacity in India. The target is, let's say, June 2025 ±, but as we start commissioning projects, there will be we will gradually keep commissioning projects one after the other, and we will update you closer to the dates of commissioning. As I already mentioned, most of the locations are tracking very well on execution. During this quarter, we have, which is very visible with the kind of cash spend that we have had. We have spent almost INR 2,545 crore on CapEx. Large portion of that CapEx was towards our expansion programs. In addition to that, upwards of INR 600 crore was spent on working capital. We consciously built inventories of fuel, given the short window that, that was available, where prices were low. We expect to bring down our fuel stocks back to normal levels of 45 days of inventory by the end of March 2024. We continue to remain negative. In spite of bulking up our working capital, we continue to remain negative working capital company. Our net debt at the end of this quarter had risen to INR 4,917 crore from the previous quarter. This is the consolidated number, but this is as per plan, and we are not really concerned about it. We will be able to push our net debt down further as we progress into the season time for cement industry beginning this quarter. You would have seen that we have grown 15% in domestic volumes, along with international volumes, the effective growth is close to 16%. This is in spite of erratic monsoons playing havoc in different parts of the country, disrupting smoother movements of material. I want to again call out the cement lead that we have, we have achieved. We have achieved about 403 km of lead, and the secondary lead, which is from our warehouse or rail heads to the customer, is dropped to about 40 km only. This clearly shows our capability and ability to serve our customers, which is supported by nearly 1,100 warehouses, 280 railway sidings, as also 52% of our dispatches are directly to our customers without having any stoppage in between. The commentary will be incomplete if we don't talk about environmental issues. Some people do get concerned about cement sector because of its emissions, high emission norms. Well, India needs, as I said in the beginning, India needs infrastructure, which needs cement, and cement manufacturing, as of now, is still with limestone and fossil fuel, and fossil fuel remain to be the main source of fuel in the country. So there will be emissions. It is important to keep in mind how we are investing behind the reduction of carbon emissions and continuously progressing on that path. As, as we speak, our various investment programs that are in place will take us to 60% non-fossil fuel energy by the time we complete our current phase of growth. You would have already heard India is bidding for 2036 Olympics. That sounds fabulous for the country, and it's music for our ears. With that, thank you, ladies and gentlemen, and I hand it over for questions. Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask questions may press star and one on their touchtone telephone. If you wish to remove yourself from the question queue, you may press star and two. Participants are requested to use handsets while asking questions. Ladies and gentlemen, we will wait for a moment while the question queue assembles. To ask questions, please press star and one. The first question is from the line of Amit Murarka from Axis Capital. Please go ahead. Yeah. Hi, good afternoon, Mr. Daga. Thanks for the opportunity. So, on the expansion program, like, you had mentioned in the last call, that the next phase of expansion is being worked on. So is there any progress, or by when can we expect a formal announcement of the same? Yeah. So it's almost stitched up... We will put up to our board and come back to you within the end, before the end of this calendar year. Okay. And, this is in line with that, 185-200 million ton capacity? Yes, absolutely. Absolutely. In fact, our chairman had already put down his vision, articulated the game plan of doing 200 million tons of cement in India, and we are very much on course for that. Okay, good. The first half CapEx seems to be a bit high versus the guidance. I think guidance was INR 6,000 crore-INR 7,000 crore. We seem to have spent about INR 4,500 crore already. True. So- No, so, again, don't annualize it. My guess is, while there's a bulk of spending has happened now, we might not have a similar level of spending, but INR 6,000 crore-INR 7,000 crore for the year should be our CapEx spend. And in case the team is able to, you know, race ahead, we are more than happy, because the faster we complete the projects, the faster we will be able to bring cement to the market. Sure, got it. Any guidance on fuel cost for subsequent quarters? As of now... So if I look at it, this quarter, the consumption price was $138. Pet coke. Pet coke. Pet coke was $138, sorry. So, but Pet coke is only 39%, for us. As of now, October-December quarter should also see southbound movement in prices of fuel. Yeah, just to add upon, I'm K. C. Jhanwar. The fuel market is very volatile, in particular, because of the geopolitical disturbances, et cetera. So, let's see how it moves forward. If the geopolitical environment gets stabilized, then there won't be much of movement here and there. Otherwise, it's very difficult to predict, actually. Got it. Sure, yeah. Okay. So, Amit, to be specific, I think we have put it down in the presentation itself. The effective consumption cost, blended fuel consumption cost, was $152 against $178, and Pet coke was $138. Yeah. Sure, I'll come back in the queueing for more questions. Thanks. Thank you. The next question is from the line of Raashi Chopra from Citigroup. Please go ahead. Thank you. Just on the pricing, you have given the, you know, the change in trends versus the June exit, but where are we versus, you know, the average of the quarter that you just reported? Average of which quarter you are asking about? The July to September quarter, where are spot prices versus that? So from July to September, average about 3% up. No, one second. Average 5% up. So in fact, I have indicated that- Raashi, in the presentation also. Correct. Slide 18, it's about 5% up. That's October 2023. I've already given an heads-up. Correct. No, just regionally, if possible, to give that, split the way. Difficult. Let me work it out, and I can share it separately. Okay, sure. Then, what was the proportion of trade volume this quarter? It's 7% trade. All right. Just in the 2.5 million tons capacity that you've added in this quarter- Yeah. 1.3 million was in West Bengal in July. Where is the remaining 1.2, anyway? So that was for the debottlenecking? Yeah. Yeah. So we had announced that 4 million tons debottlenecking. Out of that, 1.2 was the Magdalla grinding unit in Gujarat. Okay. So now you are left with 3 million tons of debottlenecking this year? Yeah, 2.8, to be precise. All right. Okay. Thank you. Thank you. The next question is from the line of Navin Sahadeo from ICICI Securities. Please go ahead. Yeah, good afternoon, sir, and congratulations on the good set of numbers. Sir, first question was on the fuel cost. So you already gave numbers that blended is $162, and Pet coke is around $138, correct? And current spot rates, as we understand, Pet coke could be more like $130-$135, and imported coal also around $140-$145 range. Yeah. Could you share what was the average imported coal cost for Q2? If I'm not wrong, it could be more like $180. I'm just trying to do some backward. Yeah, yeah, you're right. Spot about $181. Right. So, so versus that, if the current spot rate is still at $140-$145, it could- Yeah. -still mean at least INR 100 per ton saving in fuel cost in the coming quarter? No, which quarter would you estimate that? December, because you would have inventory and 180- Navin, let me explain the concept of the spot prices. When the spot prices are being quoted, let's say 19th of October, they are for two months ahead of... Loading is two months ahead. That's point number one. Those are spot prices. Then give or take 45-60 days of shipping time, clearing time, reaching the plant. You have, I didn't put the slide or didn't mention it, but I'm carrying inventory of 60 days, as at the end of this quarter. So the spot price that we talk about will not come into consumption before March 2024. Agreed. But sir, by that logic, I would actually want to capitalize on a much higher savings, because in mid-July or in month of July, the imported rates were well below $120 also. Okay, okay. I will tell you, typical of stock market, if you put a buy order for 10% of a company, what will happen to that stock price? It will go to the roof. All right. So no, no, Navin, on a serious note, you know, Pet coke market is a very, very small market. Today, if anybody steps out to buy bulk quantities, the prices will just shoot up. So it is identical, the way the market behaves. Pure phenomena of demand and supply. Please don't annualize the cost. That's the message which I tried to give in the beginning of the call. Don't annualize the cost or any number. No, appreciate. Then, let me just put it simply: How much more savings can we expect in the coming one or two quarters? Good question. Next question, please. Sir, no, I know, I'm not able to reveal that, on the call, Navin. So this is specifically for, the call is for the earnings, performance. Thank you. On a serious note, not to leave Navin unsatisfied, the cost curve is moving southwards. Yeah. Next question, please. Thank you. The next question is from the line of Indrajit Agarwal from CLSA. Please go ahead. Hi, sir. Thank you for the opportunity. I'm just trying to bridge the net debt trajectory from June quarter. So we had about INR 2,469 crore last quarter, and now we have about INR 4,920 crore. Right. Understand, the CapEx and working capital is taken together with around INR 3,100 crore kind of outflow. My back-of-the-envelope calculation- Sorry, plus the dividend gets paid out 100% in this quarter. That is close to INR 1,100 crore. Yeah. All right. So that was missing. Right. Right. Thank you. And just to remind us again, how much inventory we are carrying right now versus 45 days average? 60 days. 50 or 60? 60. 60 days, 60 days. And, uh- Normally 45 days, we have built up to, 60 days. Mix-wise, it is still the same, the inventory that we are carrying that, in the sense- Yeah. So, you know, the consumption of Pet coke from 40% could go up to 50%. It would be range bound like this. Okay. And on a landed basis, Pet coke, how does it fare versus coal today? Pet coke versus what? On a landed basis, effectively, Pet coke becomes cheaper. Certainly, the traded price is also economical. Yeah, but the gap, the gap is not too big actually now, because the Pet coke prices are now, now Pet coke is getting traded around $140 or so, actually. Mm-hmm. Now, not a big gap, actually. Mm-hmm. The coal is also at $140, but yes, some weightage of the calorific value. That's why the effective price of Pet coke is still marginally cheaper. Sure. My last question is, based on your experience, what moves Pet coke more? Is it crude prices or on the demand-side dynamic? Demand, supply. Demand, supply. Not by and large, it's nothing to do with the crude prices. Mm. It's purely, as Atul said, it's Demand, supply. Demand s- The next question is from Mr. Satyadeep Jain. Can you hear us? Yes, I can. Yes, please go ahead with the question. Hi, thank you. First question on the capacity expansion. So earlier you mentioned achieving 160 million tons, give or take, by 2025. Beyond that, the next leg of expansion, should we assume that the company will start committing to it after this expansion is complete, so the whatever 25-30 million ton capacity comes 24 months or from there, or is there potential to maybe start working on it relatively soon, so that it doesn't get so staggered? Tied to that would be how much more debottlenecking capacity potential could be there in the existing capacity base? Okay, to your first question, we will not wait to complete so that, the reason being that we should have a continuous supply of capacity available, given the high growth trajectory that we are seeing in the Indian market. So we will definitely start work on the second phase of, third phase of growth very soon, the moment we get a nod from our boards, which, as I mentioned, we will be presenting before the end of this calendar. As for, hi, are you there? Yeah. Yes. As for debottlenecking, I think as we progress, if we unearth something, which we'll be more than happy to pick up on the side. As of now, on the existing projects that are ongoing, nothing significant has been identified. Okay. Thank you. Secondly, on the eastern market, you mentioned rains and different factors led to slowdown. Any ballpark estimate on, in your estimate, what could have been the industry volume growth for India as a whole, and maybe east could have been maybe low single digit? And given that, now the quarter has ended and going into October, have you seen maybe a recovery to more normal volumes in line with the rest of India? East continues to be slow, and our expectation is maybe 4%-5% growth is what we'll see for the industry in the eastern corridor, against which we have grown better than that. All India, again, average expectation on the basis of whatever we have seen in the marketplace, industry should show a growth of close to 9% or 11%. Maybe double-digit growth, yes. Okay. Just one housekeeping question on the slag contract you signed with SAIL. Any maybe pricing indication? Is it much below spot pricing? What kind of pricing arrangement have you had for this slag contract? Yeah, why do you want to know so many details? You look at the EBITDA performance next quarter. Okay. All right. Thank you. Thank Thank you, sir. Thank you. Thank you. The next question is from the line of Ritesh Shah from Investec. Please go ahead. Yeah, hi, sir. Thanks for the opportunity. I'll just pick up from Satya's question. Sir, what is the sort of cost inflation that we are looking for both fly ash as well as slag? And, do we have any long-term contracts, on a percentage basis, which are indexed to WPI, something of that sort, which can ease up on fly ash and cost, fly ash and slag for us? So I'll take the second question first. The contracts are normally not more than a year. Nobody does longer period contracts, and they are not linked to WPI. These are again negotiated contracts. If I were to deep dive, again, it's a demand and supply phenomena, depending upon you know, the appetite in the market and availability, how the prices perform. Generally, the price discovery used to use through the tender process or e-bidding kind of thing. Mm-hmm. That's the way generally it happens. Right. But sir, has the slag inflation been quite steep in recent times? Basically what we pick up is that it's more expensive than clinker costing. The reason we called out slag and fly ash, because these, these are the two biggest raw material cost items. Okay, that's fine. Sir, secondly, so yeah, yeah. Sir, when you indicated we have around 60 days of inventory, is it possible for you to qualify how much would be the average cost over that? Cost of holding? Yes, sir. Inventory cost. Uh, you- Sir, it's around $1 62. That's the average cost of inventory. This is on a blended basis, adjusted- Blended basis, yeah. $162. Hello? Yeah. Yes, sir, that was for the quarter. I'm saying quarter-end basis. Almost the same. EBITDA is almost the same. Okay, okay, okay. That, that gives a fair indication. Fair. This is useful. So thirdly, how are you looking at other Birla Group assets? I'm asking question more from an inorganic JV standpoint. There has been a lot of news flow around a lot of assets. How does the group approach it? What's the thought process over here, sir? There are companies which have some problems on the balance sheet side as well. So, is the company open to, say, something like a preferential or the idea is to go for entire asset, or we won't be even open to it? How should one understand this? Ritesh, I am so drowned in UltraTech, so much things to do, that I don't get time to see what is happening in other group companies. I really don't know, I don't have any answer for your question. Fair enough, thanks, sir. Let me put it the other way around, sir. If there are any assets available, is there any particular region which will be of more interest, let's say, something in Central India or Southern India? Will you look at it or it's a pass? We will, yeah. So, one thing very clear is that almost the entire geography of the country, from, you know, regulatory perspective, I think we can still acquire capacities. That should not be a constraint, barring perhaps east, which, because the size of assets themselves are significantly large. So then the next point is, we keep on evaluating assets, and it has to give us a profitable growth opportunity. Then only it would make sense for us. Sure. Sir, last question, if you could provide some color on the white cement and putty markets, that would be great. There is something called Birla Pivot, but I'm not very sure whether it falls under our umbrella or any of the other Birla Group Entities. Last two questions. Yeah. Birla Pivot is Grasim. They are doing something over there, so you'll have to ask them. White cement and putty market prices were subdued. We've seen volume growth happening. The RAK, we have been getting volumes from RAK White also. It has been rebranded as Birla White, and consolidated, we are seeing volume improvement. Sure. This is helpful, sir. Thank you so much. Thanks, Hitesh. Thank you. The next question is from the line of Rajesh Ravi from HDFC Securities. Please go, please go ahead. Yeah, hi, sir. Good afternoon. My question pertains to first on the regional demand and utilization in Q2. So could you throw some color? You mentioned the east growth could be to the tune of 4%-5% on a pan-India versus 9%-11%. So which market grew, you know, more than 10, 11% and also regional utilization? Very difficult to, you know, quantify individual regions. Mm-hmm. But, you know, if we are growing 15%, this quarter, UltraTech has grown 15% this quarter- Right. - with 75% capacity utilization on 132 million tons. That gives you a fair perspective that it's fairly balanced. Okay. There would be, you know, sparks of high growth somewhere, or mediocre growth elsewhere. Mm-hmm. And this demand, any flavor of which market, regional wise, regional versus which market grew at what rate? I just said I think 15% is what we have grown. Practically all markets are doing well. Okay. Sir, on the fuel cost, you, on a per kilo cal, the fuel costing was how much in Q2? Is it, this- 2184. 2184, okay. Okay, 2184. There is a slight cool off. Sir, you mentioned this debottlenecking. You did 1.2 million ton at Makadwala? Yes, please. Okay. So from 0.7 or it is now close to 2 million tons. Which are the other places where this debottlenecking would happen? There are a few opportunities which we are tracking. We will, you know, come back once everything is done. Okay. Okay. That's it. That's all from my end. Thank you. Thanks, Rajesh. Thank you. The next question is from the line of Rahul Gupta from Morgan Stanley. Please go ahead. Hi. Thank you for taking my question. Very good numbers, Mr. Daga. There have been a lot of questions around fuel costs, but I don't want to bore you. I just want to understand one thing. Is it the company has seen around 20% deflation on fuel cost over the last three quarters, right? I mean, from $200 to $162. If I do just back of the envelope math, is it fair to say that we would see another 7%-8% decline, and that would be the end of it, given where current prices are? I know you can't comment on how prices move on a daily basis, but- Yeah. -given the inventory levels. So, you know, even if I took $16, $3, $10 or $11 dollars reduction seems to be possible, but very difficult to forecast. As we saw, $100 remained for a very brief period, shot up to $140, $135. But yeah, $10, if everything remains steady, no more global upsets, then yes, we could see a reduction of $10. Perfect. Thank you so much. That's it from my side. Thank you. The next question is from the line of Kartik Rathi from Macquarie. Please go ahead. Take the next person. Sure, we'll move to the next question. The next question is from Raghav Maheshwari from Asian Markets Securities. Please go ahead. Sir, congratulations on a good set of volume growth, firstly. Sir, my question is for the Pet coke and the fuel side. You mentioned in your presentation your blended consumption is $162, where you have mentioned that Pet coke is particularly $138. Is it the right? Yes, sir. Sir, the usage of the Pet coke is the 39% of the total mixed fuel mix. Yeah. This 39% is for the, only for the kiln or the at TPP level also? Talk about kiln only, and Pet coke goes only in kiln. No, the 39% is only for the kiln, right? Yes, please. Sir, now, Pet coke is not allowed to be used in- In thermal plant. Power plant legally. Yes, yes. Sir, so my question is from that, key, why is it the, what is the restriction for we are just using 39%? Because it's the availability side issue or the kiln specifications issue? No, it's more about availability. Okay, sir. And sir, what is the status for the Pet coke? It's particularly available at a domestic site, or it's mostly the imported only? Imported, mostly imported. Pet coke is imported.... Okay, sir. Got it, sir. Thank you. Thank you. The next question is from the line of Sumangal Nevatia from Kotak Securities. Please go ahead. Yeah, good afternoon, sir. Just two quick clarifications. One is this 160-200 million tons of aspiration which we have, over what period are we looking at? What would be the end year, if you could just clarify that? I'm sorry, I missed your question. Can you repeat, please? Sir, this capacity expansion in the next phase, phase III, which we're talking or which you're evaluating- Yeah. from 160 to 200, what is the end year for that? Over which period are we kind of working on? 28, the next phase of growth will not take us to 200. Again, so we will do in blocks of 20, ±20 million tons. So that from, so like 20, mid-2025, mid-calendar 2025, we will reach 160. I'm just using a rounded number. Then again, a 20 million ton, which will get completed by 2027, calendar 2027. Yeah. So that will take us to 180. And then again, before we complete, I'm sure we will be ready for the next phase of growth. So every year, we will keep on looking at balancing our capacity book in line with the growing market. Understood, understood. And versus the two years back, given the growth and the market share gain which we are seeing, I mean, some front loading of expansion plan is expected, right? Can we safely assume that? Absolutely. Okay, got it. And just one, sir, last clarification. The employee cost and other expense, are there any one-off or it's just purely seasonal, and then it should- In fact, I mentioned about it, close to INR 70 crore would be one-off. Yeah. 40 plus some other, but the other bonus, yes. Yeah. So INR 70 crore would be one-off, the retention and this and that. Next year, we Close to INR 70 crore is a one-off cost. So is it non-cash or it's cash, but not likely to be? Cash, cash. Okay. Okay. Okay, got it. All right, thank you. Thank you so much, sir, and all the best. Thank you. The next question is from the line of Jashandeep Singh from Nomura. Please go ahead. Hello. Hi, sir, thank you for the opportunity. Just wanted to understand from you how you are seeing the rural demand, and also, if I'm not wrong, last quarter we mentioned some market share loss, marginal market share loss in South. So have we been able to recoup that? In the first question. Was the rural market for us... Can you repeat that? Yeah. Rural market for us has been growing. Growing. Yeah, the rural market is still robust. Actually, there is, we have not seen the, the kind of probably FMCG companies are, probably, having the problem. But, by and large, it is, still robust, because in rural also, there is a lot of, infrastructure and the local, body work, et cetera. So, but still, I would say rural market is not, impacted. Marginally, here and there, there would be some, some pockets, maybe, So yeah, to add further to what, Mr. Jhanwar said, if you look at slide 7, I have called it out. Rural, rural sales were at 63% of trade, grew 15% for the quarter. So that's how rural markets are performing. And again, you know, a bigger picture, the definition of rural markets is continuously evolving. Rural is no longer the old rural, which was with pure agri. As Jhanwar you were mentioning, there's a lot of infrastructure growth happening in, the so-called rural market as well. Right, sir. On the South India market share that we mentioned last quarter, that a marginal loss was there. This quarter, have we been able to regain that? Huh? Sir, in the last quarter, we mentioned we lost certain marginal market share in South India, so were we then able to regain that this quarter? No, I don't think so. I think we don't recollect having shared any- Nothing like that. Okay, no issues, sir. Sir, on the linkage coal, what will be the percentage of domestic coal, if you can share that? Domestic goal is about 6-6%. 6%. Huh? And so- In kiln, I'm talking about in kiln. In kiln, right, sir. Right. And sir, if I can squeeze one more, since we are now moving towards 200 million tons by FY 2028, 2030. Just wanted to understand, there is also enough cash balance, and the company has become one of the biggest, it is one of the biggest cement manufacturer. So is there any related sector also that the company is evaluating? Like we have some, you know, exposure to the chemicals, building chemicals. So just wanted to understand whether the management is thinking on that line as well. You know, if you look at cement as a sector in India, what is the size of cement? 385 million tons. 385. In billion dollars, is $30 or $30 billion? So looking at the size, just a match, sir. Looking at the size of cement business in the country, there is no other adjacency which looks meaningful, and we will not do any diversification. Unrelated. Unrelated activity. So cement is—I was saying 30, is actually $35 billion worth of market. There's no other adjacent business, now, whether it is tiles, whether it is, whatever else you will have in mind, paver blocks, tiles or sanitary ware, etc., etc. Nothing is so big. We are already present in white cement, RMC. We are doing pretty well, growing very rapidly. Gray cement remains our forte. Understood, sir. Thank you. Thank you. The next question is from the line of Raj Kiran Gandhi from SBI Mutual Fund. Please go ahead. Hi, thanks for the opportunity. So just here, you know, if I were to go by saying that, you know, you will reach 200 million tons by 2030, as you mentioned, you know, it will translate to a CAGR FY 2023 to then of about, you know, slightly over 7%, which seems to be a bit lower versus what your peers have guided in their strategy. So just any comments on there, and also in light of the bunched up capacities that we are seeing in terms of ordering and also how do you see the pricing from a medium-term basis? So what is your question? Whether our growth plans are inaccurate or not enough, or I didn't get your, the- No, in terms of your peer growth path, which they have guided being significantly higher versus the capacity growth guided by you. So in that sense, you know, how do you read that? So that was one. No. So to answer that, you'll have to ask them on what their plans are. Ideally, I'm not in a position to comment on their plans. When we give out our plans, it'll be with nuts, screws, and bolts, everything stitched together. You will know where our capacity is coming, how much capacity is coming, unlike some figment of imagination. So when we are announcing our expansion plans, they are very rock solid. With an underlying economic hypothesis basis, we understand the Indian market very well. We know how Indian market will grow, where it will grow. Accordingly, we will add capacity. And more so, it's a revolving one. Sure. Okay, okay. Thank you. Sure. The next question is from Shravan Shah, from Dolat Capital. Please go ahead. Yeah, thank you, sir. Just to clarify, INR 70 crore extra one-off, you said this is only for the staff cost? I think staff cost and others. Yeah, these are one-off. For staff costs, how much one can think of one-off? So from next quarter, how much one can think of to lower? 30 crore-INR 50 crore will be out of it. Okay. And rest, INR 20-INR 30 crore will be the maintenance cost extra, the, Yeah, extra maintenance cost. Yeah. Okay. Okay, got it. Second, on the pricing, sir, you mentioned that, 5%, current prices are higher versus the 2Q average. In terms of the non-trade also, the similar trend, one can look at? Yes, please. Okay, that's great. Second, in terms of the fuel mix, you said that 6% is domestic coal. So broadly, 39% was Pet coke. So how much was the entire coal, imported, domestic, everything, coal was how much? 51% imported coal, Pet coke 39%- Alternate. Alternative fuel, 4%. 4%. Okay. And sir, on the green share, particularly both WHRS and solar. So last time we have talked about to reach a 1,250 MW by March 2025 or maybe 1Q when we will complete this 22.6. So not 22, 24.4, we'll complete. So broadly, how one look at from current by March 2024, by March 2025, how much one can look at in terms of the increase in both capacity and the green cells? So currently 22%, so how one can look at? Ultimately, what I am trying to understand is, by FY 26, my broad calculation says we should see at least incrementally INR 60-70 per ton kind of a savings from only from the incremental green capacity that we are adding. So I don't want to quantify that saving, because, you know, the rates also, not for renewable energy, but for other activities, rates could change. But, yeah, in terms of percentages, we have reached 22%. We should be reaching more than 50% or actually 60% by- Twenty. Twenty-five, twenty-six. Okay. So currently, broadly, is it fair that the grid cost would be INR 6.5 or 7 and the solar cost for us would be INR 2.5? Yeah, the grid rate is varying from INR 6-INR 8. Yeah. From dependent to state and- Renewable energy is not INR 2, it's INR 4. Yeah. That That differential is not more than INR 2 actually, because there are a lot of government levies, wheeling charges and some cross subsidy in certain- See, the generation cost, you are right. But that is at the generation point. From there, for transmission, wheeling charges, et cetera, loaded, it comes to close to INR 4. Okay, and... It goes up to INR 7. And then, in terms of the lead distance, it's great that it is slowly reducing, so 406 now. So by when we complete this 24.4, how much one can think of 30-40 kilometer further reduction is possible? Structurally, I'm saying. It won't be so much, but yes, it should be downward only. ... Okay, okay, okay. And broadly, in terms of this out of this, the next phase, by first half of FY 2025, is it fair, 7-9 million tons can come up by next September, and rest maybe by March or June? Yeah, possible. Okay. And in terms of the clinker also, roughly 15 million tons would be the clinker to support this expansion? Yeah, we have already covered that. Yes. Okay. Okay, okay, okay, great, and thank you and all the best. Thank you. Thank you. The next question is from the line of Pathanjali Srinivasan from Sundaram Mutual Fund. Please go ahead. Hi, sir, am I audible? Yes, yes. Yeah. So my first question is on what is our margins been like for the RMC and white cement business? Because it looks like you've done much better than compared to the previous quarters. Correct me if I'm wrong. The margins for RMC are, you know, RMC is an incremental margin business, 3%-4% is the margin that we can, 5%-6%. Margin 4%. 4% margin is what we have now, incremental margin, so we do a transfer pricing from cements to RMC. Thank you, sir. And, one more thing, the realization-wise, have you taken any price hikes towards the end of the quarter? And, what has been the decision from RM for this? Because a lot of news about companies taking price hikes came in. Yeah, I think you were not there in the beginning of the call. We have taken price. I think September, mid-September onwards, we started seeing price improvements happening across the country. So if you could just tell me, what is our closing price, sir, within the last, like, the end of the month, what price did we close at? Realization. Closing price, but with each market, and you know, I don't know which city you are in. If in Mumbai, the price in Andheri will be different and price in Thane will be different. So, difficult to say a closing price, but if you want to look at increase in prices, 5%-7% increase has already happened since June. Okay. Okay, sir. Sure. But, then, can I take it as it is some realization from the previous quarter, it should be, like, 5-6% above that? In this quarter? Yeah. Yeah, in this quarter, obviously, if the prices hold, then you could see an improvement, proportionate improvement. Okay, no, I'm just trying to get that number quantified from you, so. I'm not wanting to quantify it. Yeah, yeah. Okay. Thank you. Thank you. Thank you. The next question is from the line of Navin Sahadeo from ICICI Securities. Please go ahead. Yeah. So thank you for the, thank you for the follow-up. Sir, you mentioned that phase three is about to be, you know, announced by end of this calendar year, but you said that it will largely get completed in 2027. So I'm just trying to understand, because typically any CapEx takes about two years or two and a half years. So by that logic, calendar year 2024, 2025, so maybe around 2026, shouldn't that be a reasonable expectation? Or you think there could be some greenfield sites which could take much longer a period? Yeah, it's a mix. It will always be a greenfield, brownfield mix. And within 2, 2.5 years, we have done a record of putting greenfield project in 15 months also. So again, it depends on the site. There were advantages that we had on that site. There was a huge effort from the team, no doubt about that. So you cannot straitjacket, as in, you know, in initiative form. Fair point. And just one thing to confirm, in the previous call, Q&A, you had talked about debottlenecking of a total of 4 million tons that was to come in FY 2024. Yeah. Correct. So is that, so when you give these numbers, at the end capacity, I didn't think you were including that in the numbers. Now I'm including that. When I said 159.65 million tons to- Okay. end by at the end of this phase Yes. We have included that 4 million tons, and also another 1.8 million tons of slag capacity that we, I just mentioned in this call. We are going ahead. Understood. That's, that's really important. Thank you so much. Thank you. The next question is from the line of Prateek Kumar from Jefferies. Please go ahead. Yeah, good evening, sir. My first question is on your pricing. So, like, we have, the industry has taken a pricing action. Has there been any impact on demand? Like, we understand, September there was, East demand was very soft, but, has the increased pricing has the same impact on demand during Q3 as well? Too early to say anything at this point in time. We are just 19 days. The biggest thing is prices are holding. There might be some markets somewhere, some slowdown, some resistance, but I think that will pass over. ... Okay, and in relation to, like, several states have announced election dates. So in relation to state elections or coming up of national elections, is there any variation in working capital release from the state government or central government? So according to me, the governments want to maximize execution of projects, so they should not, this is just a logical analysis, that they should not hold back payments for all the contractors, otherwise it will impact progress of work. Hence, the working capital of all the infra companies should remain strong as far as their receivables are concerned on government projects. Right. And my last question on your other operating income, and that, on a quarter-on-quarter basis seems to be slightly higher, from around INR 220 crore this quarter. Again, a specific component in the lock as well. Incentive. Incentive. Yeah. Then what was there extra? No, just how much is other operating income? It's INR 281 crores versus INR 271 crores. Is that a significant difference? No. So, we were looking at INR 277 for this quarter versus INR 18 for Q1, so, maybe, Consolidated INR 277 crores. Last year was INR 297 crores. It has fallen. Okay. So I was just seeing quarter-over-quarter, so, okay, maybe we should see it year-over-year. That way, exactly. Quarter-on-quarter, yeah, one or two incentives would have kicked in. Quarter on quarter? Quarter-on-quarter, yes. Quarter-on-quarter, yes, so where some additional incentives kicked in. Hello, Prateek? Sure. Sure. So these are my questions. Okay, thank you. All right. Thank you. The next question is from the line of Vaibhav from Phillip Capital. Please go ahead. Yeah, thank you. Good evening, sir. Sir, I have only one question. You mentioned in our earlier remarks that pricing can be very different in different parts of the city itself or in different parts of the country. So like UltraTech was earlier contemplating, and what we gather is that you were talking of one India pricing or one district pricing or one region pricing. Can this ever be a reality for the industry in the long term, that we have one city or one district or one? We never said that. No, Vaibhav, I think, to best of our knowledge, we have never said that, one price, one country, one price, because- It's not possible. Not possible, because you know, the logistic issues, cost structure is different in different parts of the country. So, to me, it looks difficult. Some long back somebody must have- No, no, no. But, but I could be reconfirming that- No, yeah. We never talked about it. It would not be logical, Vaibhav. Yes, sir. No, I know that, sir. I understand. I understand, sir. I was just asking you from the perspective, can we have one district or one city or one state, something like that, some uniform, more uniformity in pricing rather than what is it currently, what I was asking, actually. So that was my question. I will explain to you, sir. Maybe this was a very small experiment, not all India pricing. It was one small geography. Okay. Okay, sir. Understood, sir. All right. Thank you, sir. Thank you very much. We'll have to take that as the last question. On behalf of UltraTech Cement Limited, that concludes the conference. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines. Thank you so much. Thank you. Thank you.