Bigbloc Construction Ltd (NSE: BIGBLOC) Q3 2025 Earnings Call dated Feb. 17, 2025
Corporate Participants:
Mohit Narayan Saboo — Director and Chief Financial Officer
Analysts:
Tushar Pendharkar — Analyst
Bhavesh — Individual Investor
Deepak Pawar — Analyst
Ranjith Kumar — Analyst
Unidentified Participant
Aditya Varma — Analyst
Jay Shukla — Individual Investor
Manish Kima — Individual Investor
Presentation:
Operator
Ladies and gentlemen, good day and welcome to Big Block Construction Limited Q3 Nine Months FY ’25 Earnings Conference Call hosted by Ventra Securities Limited. 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. Could you need assistance during the conference call, please signal an operator by pressing star on your touchstone phone. Please note that this conference is being recorded. Before we begin, I would like to point out that this conference call may contain forward-looking statements about the company, which are based on the beliefs, opinions and expectations of the company as on-date of this call. These statements do not guarantee the future performance of the company and it may involve risks and uncertainties that are difficult to predict. With that, I would now like to hand over the call to Tushar from Securities. Thank you, and over to you, Tushar.
Tushar Pendharkar — Analyst
Thank you. Thank you. Good day, ladies and gentlemen. On behalf of Ventura Securities Limited, I welcome you all to Big Block Construction Limited’s Q3 and nine months FY ’25 earnings conference Call. The company is today represented by Mr Mohit Sabu, Director and CFO; and Mr Manish Sabhu, Marketing and Strategy Head. I would now like to hand over the call to Mr Mohit Sabhu for his opening remarks. Thank you, and over to you, sir.
Mohit Narayan Saboo — Director and Chief Financial Officer
Thank you thank you Good morning. Thank you and good afternoon, everyone. It is a good pleasure to welcome you all at this earnings conference call for the first-quarter and nine months ended of the financial year 2025. Let me start by giving you a brief overview of the financial performance for the 3rd-quarter and nine months ended of financial year 2025, followed by some of the operational highlights for the period under review. For the 3rd-quarter under review, the revenue from operations was INR57 crores, which declined by approximately 8% year-on-year and rose by around 10% quarter-on-quarter. Operating EBITDA was reported around INR6 crores, reflecting a decline of approximately 62% year-on-year and 21% quarter-on-quarter. Net EBITDA margin stood at around 10.74% for the 3rd-quarter. Net profit-after-tax was INR30 lakhs approximately, which decreased by around 97% year-on-year basis and rose by 50% quarter-on-quarter. The performance for the quarter was primarily impacted by lower demand due to the festival season in Diwali and the state elections in Maharashtra. For the nine months under review, the operating revenue stood at INR160 crores, which declined by around 9% year-on year. EBITDA was reported at INR24 crores, representing a decline of approximately 46% year-on-year. The EBITDA margin stood at around 14.68% for the period. Net profit-after-tax was around INR3.5 crores, which was lower by 84% year-on-year. On the operational front, the company’s sales volume for the quarter increased marginally by 2% on year-on-year basis and approximately 12% on a quarter-on-quarter basis. The consolidated capacity utilization of the three running plant was around 53%, which was lower due to the gradual scale-up of plant, which has recently-completed stated upgradation and the lower utilization for the Construction Technologies Private Limited plant, which has recently started production, which also resulted in a loss of around INR5 crores at the subsidiary level for the quarter under review. On the capex front, the technology operations for the plant and completed as on 16th October 2024, the plant has commenced commercial operations, which will be scaled-up gradually. The plant capacity utilization for the 3rd-quarter was around 41%. We have also completed Phase-2 of the Vara plant expansion and digest our AAC block manufacturing capacity doubled to 5 lakh cubic meters per annum at this plant. A new product launched by and Construction Technologies under the brand-name, Smart wall Block have recently received productive certificate from IIT as well as ARAI. Block is the only company in India which can supply 20 feet wall, which was previously being imported from other countries. Additionally, we have expanded our product lines in-construction chemicals and will soon be starting rock-jointing water, cluster and tile addressive manufacturing, which are designed to enhance construction efficiency and durability. We have introduced next grip along with its trusted run, ensuring superior bonding, strength and performance for diverse construction needs. I’m also happy to inform that the company has secured INR4.5 crore work order from Tata Project Limited for the supply and installation of 2 lakh square feet of 100 ml AAC panels at Micron, India’s semiconductor facility in Sanand, Gujarat. Marks the addition of Tata Project Limited as a new customer, we are further expanding the company’s client portfolio. We believe this customer and this order and the semiconductor industry offers enormous future growth opportunities for our company. Lastly, I’m delighted to share that our commitment to sustainability has reached new heights. We will install 800 kilowatt rooftop solar power project in our plant at Star Block. Additionally, a 1350 kilowatt solar rooftop system will be installed at our newly established factory under the joint-venture Block. With these new additions, our total solar power capacity will be reaching approximately 3,475 kilowatts across the company and its subsidiaries and reinforcing our submission to integrate renewable energy solutions into our operations. During the quarter of the total power requirement for the company, 16% came from renewable sources of energy. And going ahead, we intend to reach this level to almost 35% to 40 percentage. With that, I now open the floor to the question-and-answer session. Thank you.
Questions and Answers:
Operator
Thank you, sir. Ladies and gentlemen, we will now begin the question-and-answer session. If you have a question, please press R&1 on your telephone keypad and wait for your turn to ask a question. If you would like to withdraw your request, you may do so by pressing star in one again ladies and gentlemen, if you have any question, please press RN on your telephone keypad we will wait for a moment while the question queue assembles. The first question comes from Bhavesh, an individual investor. Please go-ahead.
Bhavesh
Sir, we are entering construction chemicals, but as I understand there are lot of already established players, although the market is growing. So can you please explain the rationale for entering this segment?
Mohit Narayan Saboo
Thank you for the question, Mr. So just to highlight, we have already been doing some training of construction chemicals like the block jointing, which is NXT fix as well as the ready-mix plaster, which is NXT plus since the last two to three years. And since we have now our volumes, almost 10% to 15% of our turnovers are coming off from these construction chemicals. We decided to venture into manufacturing of these products. And at the same point of time, in the same setup, we will be also able to manufacture edits, which is another new product that we are introducing and looking at improving our realizations and increasing our sales for these products, we decided to enter into manufacturing of this product because the customer — the target market for these products is happens to be the same as which happens to be for our AAV block division.
Bhavesh
So yeah, yeah. But sir, can you explain in terms of what are the prospects, what is the market size and how fast is it growing?
Mohit Narayan Saboo
So earlier, people used to follow the traditional method of making you know, mixing tile with cement and using it for joining the blocks or tires or also the bricks. Now people have started using a bad form of motor. Similarly, for plaster also, people have started using the ready-made version and the market has been growing at least around 12% to 15% and it gives us a value addition in that aspect that the customer does not need to go to different smaller manufacturers of construction chemicals and he’ll be able to procure from a similar supplier of blocks, the same product of block jointing, what are dial after every day.
Bhavesh
Right, got it. And sir, lastly, in terms of market in Maharashtra, I think we had seen a slowdown in first-half FY ’25, but are we seeing a pickup? And if we are seeing a pickup, is it mainly from running quarter?
Mohit Narayan Saboo
Yes, Maharashtra market was a little bit slowdown in the last Q3 because of the general elections ongoing in Maharashtra. And post the election results from mid-December onwards, we have started seeing a decent pickup in Maharashtra. And I think going ahead, the Maharashtra demand should keep on growing as also is coming up with lots of different infrastructure projects, which are also helping in increasing the requirement for housing. And at the same point of time, the projects like Mumbay Airport will help growth in that region as well as Puna, IT and everything has been growing phenomenally. So we see quite a promise from Maharashtra.
Bhavesh
Okay, sir. I’ll join back the queue. Thank you.
Mohit Narayan Saboo
Thank you.
Operator
Thank you. Next question comes from Deepak Pawat from India Fund. Please go-ahead.
Deepak Pawar
Hi, good afternoon. Am I audible?
Mohit Narayan Saboo
Yes, sir, you’re audible.
Deepak Pawar
My question is regarding what are the debt repayment plan of as we have already taken a debt and we have already gone for the capex.
Mohit Narayan Saboo
Your voice is not very clear.
Deepak Pawar
Hello I wanted to know regarding what is our debt repayment plan.
Mohit Narayan Saboo
So regarding our debt repayment plant, I think as on 31st December ’24, our debt-equity ratio will be in the range of almost 1.151.2 is to-1. And we have done recently-completed majorly all of our expansion apart from the rooftop solars which are self-sufficient on their own. And going-forward, as the capacity utilizations keeps on increasing, our debt level will keep on-going down as our volumes as well as our margins will keep on improving.
Deepak Pawar
Okay. So can we expect debt repayment in next two to three, three years of life-time span?
Mohit Narayan Saboo
Honestly, our target is not to repay the debt. We are a growing company and we’ll be coming up with more expansions in the next couple of quarters as well. We have recently-acquired one land in Central India near Indore, where we’ll be putting up one more AC block manufacturing setup. And on a long-term basis, I think our debt-equity ratio in the range of 1 to 1.5 is to one is somewhat I think should be quite comfortable as the industry also has been growing significantly over the last three to four years.
Deepak Pawar
Okay. So my next question is regarding the capex itself. As you said, you are currently a venture into Indor. Okay, any other region because last-time I remember you were talking about South India so any progress on those parts?
Mohit Narayan Saboo
I think last-time we had talked about coming up with manufacturing setups in two different locations, one in Central India and other in Southern India. So the Central India land near Indor has recently been acquired just a day back or so. And Southern India also, we are looking at the land opportunities and we will hopefully be finalizing the same in the upcoming couple of quarters.
Deepak Pawar
Okay. On the second — my next question would be, what is the ratio where we supply in the reality construction and infra construction? Is there any ratio available how much we supply to?
Mohit Narayan Saboo
So almost 65% to 70% of our material is going into commercial as well as real-estate places, almost 15% to 20% of the material is going into industry, you know, Reliance or, or, etc. and 10% material is going into retail spaces as well in retail sales.
Deepak Pawar
Okay. My next question is on the chemical front. So this chemical whatever we will be manufacturing, will it be B2B or B2C?
Mohit Narayan Saboo
This will be majorly B2B again as we have been doing a lot of trading of these construction chemicals in the last two to three years. And we’ll try to develop a small vertical of B2C also in the smaller 1,000, we’ll be manufacturing these on our own, we’ll be able to get better realizations and better sales-through those networks as well. So as I mentioned that we have a retail network also for block. We will be using that network for the B2C as well.
Deepak Pawar
So in the Construction Chemicals segment, what would be our margins — EBITDA margins that we can expect.
Mohit Narayan Saboo
I think similar margin of almost 18% to 22 percentage is something what we are seeing in the construction chemicals space since even in that reading division, we have been witnessing almost 10% to 12% margin for the construction chemicals.
Deepak Pawar
Okay. My last question would be on the carbon credits. Generally, we sell these carbon credits once in a whole year, right? In 1/4 we get this credit sold and get included in the revenues. So which month we do that and what would be the revenue from the because it’s any ballpark figure for this year?
Mohit Narayan Saboo
So in the current year so-far no carbon have been sold, we are waiting for the issue of carbon credits from the audit authorities of Vera. And once the credits are issued, we see require with the markets required with the buyers as what the current running prices are and then probably we’ll take a call as to whether to sell them or to hold-on to them for better realization.
Deepak Pawar
Thank you. That would be all from my side. Thank you so much.
Mohit Narayan Saboo
Thank you.
Operator
Thank you. Next question comes from Ranjit Kumar from Spark Capital. Please go-ahead.
Ranjith Kumar
Hello. Hi, am I audible?
Mohit Narayan Saboo
Yes
Ranjith Kumar
Yeah. Good afternoon. So my question is on the raw-material front. So I’ve had access to look at the raw-material composition of few other AAC block players in the market, the organized players. I think big block in particular uses more ash content in terms of volume, right, when compared to the other players who use a bit of more cement with climb, etc. So I was just wondering what the impact of using more ash contained in AAC blocks would be in terms of compression strength or any other mechanical structured property. Because from whatever I understand, increase in the ash content actually increases the city of the brick, resulting in a lower strength. So I was sort of wondering like what kind of grade that you sell to your customers? Would it be grade A or will it be a Grade C? That is one question. Second question is, from where do you actually procure cement — six cement and quick line for your bricks?
Mohit Narayan Saboo
So coming out to your first question for the ad contain. So I think as per my understanding, across the entire AC block industry, almost entire industry would be using ash in the ratio of 60% to 70%, 65% being the industry average, someone might be at 63, someone might be at 67 depending on their product mix, etc. And in terms of the compressor strength or the product rate. So we have been supplying products as per the client requirements and have been having repeat orders from various customers, the likes of LNT,, Adani, infra,,, and many others. So at most of these sites, the block requirement is Grade A-block, which is a Grade 1 block which is required to compressistent of four-plus, whereas for certain specific customers where the specific requirement is of five-plus compared to spend the right of Abujar payments and a few others, which I cannot name right now. We are also making specific spend material of 5% where the payment or the requirement goes up and the requirement goes down. But yes, we have tried to maintain our raw-material mix in a way that we give customer satisfaction the first priority and at the same point of time keeping our costing at the lowest possible. In terms of the availability of payment and line line has been procured at all the eight block units from Rajasthan. There are various different manufacturers of lines climb powder, which we have been using. We have been sourcing from them since the last decade or so that the quantities from different suppliers keep on changing. Since we are running four different plants and our requirements are quite high. And in terms of payment, again, the regions where we are located, there is evidence of payment available on the prime supplier. The for us is under cement and various others include JK super as well as Cement or many others
Ranjith Kumar
Okay thank you thanks a lot thank you.
Operator
Thank you. Ladies and gentlemen, if you have any question, please press RN1 on your telephone keypad. Next question comes from Punanya from Partners. Please go-ahead.
Unidentified Participant
Hi, am I audible?
Mohit Narayan Saboo
Yes, you’re audible. Please go-ahead.
Unidentified Participant
Sir, by when we can expect the margins to go to a previous level?
Mohit Narayan Saboo
So for the last quarter, our margins have been in the range of almost 15% EBITDA, but that also includes the lower utilization of the new JV plant where we have introduced AAC already made, which is the only product available for a height of up to 20 feet. And this plant has been running at substandard utilization because in the last quarter itself, we have got some certificate from IIT as well as AR/AI for the compressor strength as well as fire installation and noise level and all those things. And I think it will take about a couple of quarters since this plant comes up to utilization levels is going up to 50%, 60% number. And if you look at our earlier plants, the three older plants that we have or plus the margins have been in the range of almost 18% to 20%.
Unidentified Participant
And so we will be able to reach our last year’s revenue this year like INR200 crores?
Mohit Narayan Saboo
What we have also said that lower was approximately around INR240 crores. So the realizations have gone down in the current year because of overall raw-material price decrease as well as a little bit slowdown in the demand as well across different regions because of general elections in the first-quarter, the Maharashtra election in the 3rd-quarter so I mean revenues might be a little lower than the last financial year?
Unidentified Participant
Okay. And what kind of growth we expect after ’25, ’20 — in the next two years, like what kind of growth are we expecting, given that we have a new business also coming up?
Mohit Narayan Saboo
So from first-quarter, the turnover has increased in the second-quarter and we have seen another 12% 15% jump-in the 3rd-quarter. So going ahead on a quarter-on-quarter basis, I think our capacity utilization and revenues will keep on increasing and we should be able to reach almost 70% plus utilization hopefully in the next three to four quarters.
Unidentified Participant
Okay, sir. Thank you. That’s it.
Operator
Thank you. Next question comes from Aditya Varma from Synergi. Please go-ahead.
Aditya Varma
Yeah, good afternoon, sir. So my question is regarding the profit guidance. What is your corporate guidance for the next quarter and financial year ’26? And also, sir, I see in the balance sheet, the interest is greatly reducing our profit. So is there any plan or we plan to maintain the same debt level in the interest? Thank you.
Mohit Narayan Saboo
Good afternoon. So in terms of the profit margin, our capital utilization is at around 33% and on and on a quarter-on-quarter, we are concentrating on increasing the utilization levels currently. And as the utilization levels keep on increasing, our profit margins will keep on improving. Coming down to the finance cost, so the finance cost has increased because we have recently expanded as well and are subsidies across all our units. There’s some upgradation of the plant where we’ll be generating lower rejection as well as the cost has gone down. So looking at those aspects, maybe the finance cost has increase, but overall, we are concentrating on increasing our company’s profitability on the long-term level.
Aditya Varma
Thank you.
Mohit Narayan Saboo
Okay, thank you.
Operator
Thank you. Thank you. Ladies and gentlemen, if you have any questions, please press on your telephone keypad, ladies and gentlemen, if you have any question please press and one on your telephone keypad the next question comes from Jay, an Individual Investor. Please go-ahead.
Jay Shukla
Are you sir?,
Operator
Your voice is not audible.
Jay Shukla
Is it better now?
Operator
Yes, please go-ahead.
Jay Shukla
Yeah. So my question is with regards to our current revenue for FY ’25 in the current nine months, we see that overall volume levels has gone down due to maybe lower capacity utilization and some maintenance work which is going on at the plant. However, we also see that the overall number of the revenue has still come down. So is there any realization issues which we face from the customers and
Mohit Narayan Saboo
We see the volume levels in the first two quarters, the volumes were down in the — in the 3rd-quarter, the volume has been a little on the higher side as compared to Q3 FY ’24. Coming down to the realization point-of-view, yes, the realization in the current year has been a little bit on the lower side because once all the raw-material costs have also been gone down and the cement prices, I think in the last quarter had hit us almost a four or five-year lows. And looking at that, we also had to pass-on some of pricing benefits to the customers. And at the same point of time because of a little bit of a slower demand growth and competition, the realizations had also come down in the last quarter.
Jay Shukla
Okay. Okay. And where do we see the realizations going from now onwards?
Mohit Narayan Saboo
So currently, we are just concentrating on increasing our utilization levels. So for last quarter, our utilization was in the range of almost 53% 54 percentage. Firstly, we want to reach the realization of almost 65% 70% numbers and then we will be concentrating on revenue — realization growth.
Jay Shukla
Okay. And in percentage terms, what would be the impact of the lower realizations roughly?
Mohit Narayan Saboo
Yeah. So our earlier EBITDA margins were in the range of almost 20% 24 percentage, but in the last quarter it were in the range of almost 18%, 19 percentage. So I think a bit of almost 4% to 5% in terms of realization and the other rate in realization has been because of the lower raw-material cost as I have already mentioned in the.
Jay Shukla
Okay, okay. And sir, recently, we have seen that there are some rate changes from GST perspective. So what would be the overall financial impact on our current inventory levels or you know the sales which we are planning to make going-forward?
Mohit Narayan Saboo
And policy, there has not been any rate change, just a clarification, which has been issued by the GST Council in their meeting on 20th of December, which has been recently-announced and there was an ambiguity going on as to what will be the ESG rate of based block. So there are two types of AAC blocks, one is talent base and the other is supply space. We have been manufacturing both. Base, we have been clearing at a rate of 18% in the flyers base we have been clearing at a rate of 12 percentage. And recently, the clarification has been issued that this client-based AAC block, which has content of more than 50% of clients will be classified as a 12% because the, which is the authority from the government of India, which is evaluating GSE rate for different products and been trying to identify this issue and we have gone ahead with the Council submissions and now they have issued that clarification that we’ll be tax 12% only. So there is no difference or any impact, it’s just the clarification which has been issued for us.
Jay Shukla
Okay, okay. And sir, just a connecting question with the realization part. So is there any accumulation of inventory along with you know, some lower capacity utilizations, which we are currently having at either of our plants. So as in the inventory is yet to be sold or is still moving as compared to the previous year or previous quarters?
Mohit Narayan Saboo
No, this is a pulpy product and you know, inventories, we keep on maintaining that our plant in a way that we have four days of inventory that are planned for finish goods as well as eight to 10 days for raw materials and raw materials, we increase the inventories before monsoon, people for ash as well as coal so that we don’t have to bear the transportation losses because of extra monster contained in both of those materials. But because of, you know, the bulkiness of the product, we cannot increase the finished goods inventory beyond a certain day because the storage sixtures are made at the factory because there is a hello,
Jay Shukla
Yeah, understood. Understood, sir sir, and can you, can you please,
Operator
MR. Jay, please go-ahead with your question.
Jay Shukla
Yeah. So, sir, my next question would be with regards to the market-share of organized players vis-a-vis the unorganized players for the AAC block manufacturers. Especially in the West region.
Mohit Narayan Saboo
So in terms of Western India, the market-share as of today in terms — you cannot differentiate directly between organized and unorganized because post-GST the organization in that way who has been dealing into cash and all is post finished. And if we count that way, the organized and organized deals, the organized are the ones who are learning multiple plants and having different setups whereas they are unorganizing the single plant of the smaller plant with a capacity of maybe 50,000 to-1 lakh cubic meters per annum. So I think that would be today at approximately 50-50 ratio sort of.
Jay Shukla
Okay. And what would be the pricing difference between the — between these two categories.
Mohit Narayan Saboo
So I think the organized players because of their timely supply, the quality of materials or services that they offer, they are able to command a premium of anywhere between 8% to 6%, 7 percentage as compared with our organize or the follower player.
Jay Shukla
Okay. Okay. Got it. I’ll get-in the queue for further questions.
Mohit Narayan Saboo
Thank you.
Operator
Thank you. We have a follow-up question from Ranjit Kumar from Spark Capital. Please go-ahead.
Ranjith Kumar
Thank you. So earlier, following-up to my earlier question on the different grades of AAC block that you sell. Obviously you said that you would be selling all different gates depending on what the customer wants. So what would be your percentage of Grade A-grade 1 or Grade 2, Grade 3? And in terms of I mean, like what is the percentage of breakage level that you see in your plants in terms of the overall volume of mix that you make? And how do you sell the ones which are kind of broken or would it be at 80% of the realization or 70% of the realization or something like that? And secondly, okay, I’ll ask my next question after you answer this.
Mohit Narayan Saboo
So in terms of the categorization of Grade 1, so there are three types of grades which I can categorize for this. One is a five-plus trends which is made-for specific customers, the likes of and a few others. And I think those volumes are in the range of almost to 5 percentage. The other is Grade 1, which is 4 plus strength, which is almost 85% to 90% of the volume that manufacturing. And the third is the Grade 2 strength, which is the 3 + strength which is almost 5% to 10% of the total volumes of our sales and these are villages where there is awareness being developed for use of AAC blocks or first time users etc. In terms of the rejection level at the plant, so the new plants that are upgraded at leans, the JV plant at Cement as well as the plant as well as the plant which has been upgraded, we are seeing rejection levels in — which is less than 2%, maybe 1% to 1.5 percentage and the star plant is running at a rejection level of almost around 4% to 5 percentage where we will be taking up the upgradation hopefully in the next quarter or so to bring down the rejection level at par with other plants of almost 1% to 1.5 percentage. And but rejection materials rubble that we call is also being sold from these plants in a way that we generate almost, you know, raw-material cost or 75% of the raw-material cost from the sale of that rubber.
Ranjith Kumar
Okay, sure. So also another question. So you’re also selling sand-based bricks, right? So what is the content of sand in that? And I think all the international AAC players predominantly use sand-based, not ash based, right? And what’s the sand-based content in your sand bricks? And what is the percentage of sand bricks as a — sand-based bricks as in terms of volume of your overall thing and what’s the realization difference between sand-based AAC brick versus ash-based ASC brick?
Mohit Narayan Saboo
So yes, we have been making sand-based LS as well as ASE block. And markets, so majorly North because region is a state where GAC blocks are being used by various builders and the same is a more premium and then expensive product, which also comes under 80% GST. The effective cost of the product goes up drastically. In terms of the content of the product, almost instead of fly ash, which is around 65% 68 percentage, sand is used to the tune of 60% to 65 percentage as there is other raw materials which include cement, climb, aluminum remains the same. So more or less it’s a more finer product as compared to pliers because ash is a waste from the thermal power plant where a sand has used a finished product which is being used. Secondly, in terms of the share of the percentage, so in terms of the total volume of our sales, almost 10% is based. Rest say, 85%, 80% is client base because the markets like and are the only markets that soon. Rest of the other markets which include MD, Maharashtra, Gujarat, South Gujarat, only, blocks are. Coming down to your question of the international market. So yes, majorly in international markets like of Europe and others, majorly sand-based blocks are only being made because they don’t have enough availability of pliers because those are not company countries which are predominant dependent on coal-based thermal power plants and because of that they use that for manufacturing of AAC blocks. India is still being a whole dominant economy where 65% of the power is generated using coal-waste term plant. The availability of pliers is much easy and it’s also almost that is waste ash basically being doubled in the area surrounding the thermal power plant, it’s still free of cost. So looking at those aspects, flyers based AAC blocks are the major shareholder — share content in the AAC block states in the country.
Ranjith Kumar
Thank you. And one more question. I might have missed it during the initial presentation probably. So you’re also doing panel wall sales are much larger in terms of surface area when compared to AAC block. So these are sold at a higher realization. So how do you see the traction growing in terms of the panel themselves versus AAC block? And would you — would you say that there’ll be shift to AAC blocks first and then probably to a more premium premiumized product like panel or how do you see the movement happening as far as customer demand is concerned for AAC?
Mohit Narayan Saboo
The AAC panels that we have introduced is a new product in the country and more or less we are the first lowers in this space and we are the only players who are providing a one panel up to a height of 20 feet. In terms of the market acceptability, it is taking a little bit more time, but with the motor of the recent order from Tata project, we are quite confident and we are in talks with lots of other large corporates for their upcoming manufacturing facilities, be it data centers or be it a semiconductors, cables, electronics, etc., manufacturing facilities. Coming down to your point of market acceptability as conversion from AAC block. So it’s not necessarily that only the AAC block customers will be shifting towards the AAC panels, but there lots of other different products, the likes of pannage panels or python panels, which is a category where we are looking at replacing those products with AAC panels because those products and the likes of panels or sandwich panels have a fire rating of almost 90 to 120 minutes, whereas our AAC panels have a fire rating of four-plus hours, which is certified by IID, which is the top four institution in the country. Secondly, the noise installation is also better than those other of panels. And thirdly, these panels which are the bison panels or sandwich panels, they have a height restrictions of almost 3 to 3.2 meters, whereas we are able to provide a single panel with a height of six meters. So looking at these unique advantages of AAC panels, we are quite confident of the growth of this product going ahead.
Ranjith Kumar
Okay. Sure. And one more final question. So how do you see competition from other kinds of bricks, right, like concrete bricks, hollow bricks and another — there’s also another technology through which you make bricks, which I’m not able to remember. But how do you see that competing with AAC blocks? Obviously, those other bricks are far better in terms of quality, price, et-cetera versus red bricks or play bricks, right? But how do they compare it with AAC blocks? And how do you see competition from those kind of bricks?
Mohit Narayan Saboo
And also AAC blocks has been growing a lot of traction and are gaining more awareness acceptability in the market. But even after all these years, the share of blocks in the volume material is around 10%, 11 percentage, whereas that of rate is still at around 80 percentage and other materials which includes different types of panels or concrete blocks or even or other technologies would be having a share of almost, 7 percentage. So there is a huge scope of growth by conversion from rail to AC blocks firstly. So the product future still looks quite promising the and once a person from will not directly move to concrete blocks or different sorts of panels because for multi-story or residentials. The unique characteristic block means the density or the light-weight is a huge advantage and without that high-rises are not possible.
Ranjith Kumar
Sure. Thanks a lot. Thanks a lot for the answers.
Mohit Narayan Saboo
Thank you.
Operator
Thank you. We have a follow-up question from Jay Shipla, an Individual investor. Please go-ahead.
Jay Shukla
Hi, sir. So recently in the quarter three, we have also seen a reduction in volumes for other cement manufacturers as well. So I believe the flow of demand would go hand-in-hand for cement as well as our AAC blocks, especially in the West region, the fall in-demand was roughly around 5% to 7%. So that can you break-down your revenue or the product mix which is used for infra use, commercial use and housing purpose.
Mohit Narayan Saboo
So yes, you’re right in last quarter, I think the cement demand did witness a little slowdown. And as I mentioned, apart from the remart slowdown, also the cement prices in the last quarter had almost four to Five-Year low because of which our realizations had also gone down because we had to pass-on the benefits to the customer. Coming down, we are for the use of the product. So as I mentioned earlier, almost 70% to 75% of the product is being sold for residential as well as commercial properties, be it housing or redevelopment or various other segments. Almost 15% of the product is being sold for industrial uses, which includes various factories coming up, the likes of steel as well as the wing of some factories, Adani coming up with solar factory or glass factories and Vari coming up with its solar factory. And certain products are also going for warehousing division and almost 5% to 10% of the product is also going for retail sales, which is being sold-on a retail level for individual go buyer who are retailers.
Jay Shukla
Got it. Got it. And sir, what would be your guidance for revenue and EBITDA margin for FY ’26 and ’27 because I believe we had earlier guided for doubling our revenue in a couple of years. So will that still remain intact or will that be subject to change?
Mohit Narayan Saboo
So currently, we are just concentrating on increasing our utilizations on a quarter-on-quarter basis. And as utilizations keep on growing, our revenues will also gradually keep on growing and yes, we’ll be seeing a substantial jump-in our top-lines in the next financial year.
Jay Shukla
Okay. Do we have any number in mind for the chapter City utilization or the revenue part?
Mohit Narayan Saboo
So I think we should see at least a 5% to 10% jump-in our capit utilization from the current level of 53%, we intend to be 65% to 70% in the next financial year.
Jay Shukla
Okay, got it. And sir, sir, as you correctly told, and as per the media release for acquisition of land near — near Indore in Madhya Pradesh, so what are our plans in terms of additional capacity, which we — which we intend to do in the coming period and approximately by when we expect the plant to be commissioned FY ’27 or even ahead of that?
Mohit Narayan Saboo
So currently we have just acquired the land. We will be doing the necessary documentation procedure for conversion of the land to raw agricultural as well as necessary permissions from the government department. And in the next couple of years, we’ll be looking at increasing our insured capacity from 1.3 million 2.3 to 2.5 million cubic meter.
Jay Shukla
Okay. And that would mean doubling your existing capacity right
Mohit Narayan Saboo
Approximately almost a growth of 80 to 120 days.
Jay Shukla
Okay, and that we are targeting to achieve this by
Mohit Narayan Saboo
Hopefully in the next couple of years.
Jay Shukla
Okay. Okay, I’ll get-in the queue if I have any further questions.
Mohit Narayan Saboo
Okay. Thank you.
Operator
Thank you. Ladies and gentlemen, if you have any question, please press R and one on your telephone keypad. Repeat, ladies and gentlemen, if you have any questions, please press on your telephone keycard. Next question comes from Manish Kima, an Individual Investor. Please go-ahead.
Manish Kima
Hello, sir. So I have a couple of questions. With respect to the joint-venture with — at what optimum capacity do we think we can breakeven because I guess the company has been reporting losses from the past 3/4 and quite understandably because I mean we are what do you say, not working — I mean it’s a new business we are also looking at the company is not provided for post-employment benefits and other long-term employee benefits as per India. And had the company done that, the profits would have reduced. So wanted to understand as to why is there a deviation now? So these are my two questions.
Mohit Narayan Saboo
So coming down to your question for the JV capacity utilizations, we have been running at below capacity utilization and I think we should be able to breakeven at a capital utilization of almost 45% to 50% for this TV company when we are able to sell almost increase our volume per panel sales. And in terms of the — you know employee benefit, so we have started doing that for all the other companies, big block had a subsidiary. The JV companies started last year probably it is list out, but in the current year, they will be accounting for the sale as required.
Manish Kima
So was the auditor observation only with respect to the JV companies?
Mohit Narayan Saboo
Yes, because for all other companies we have been providing for the necessary post-employment benefits as required on a you know on a compliance basis
Manish Kima
Thank you.
Mohit Narayan Saboo
Thank you.
Operator
Thank you. Ladies and gentlemen, if you have any question, please press R&1 on your telephone keypad repeat, ladies and gentlemen, if you have any question, please press car and one on your telephone keypad. We have a follow-up question from Jay Shipla, an individual investor. Please go-ahead.
Jay Shukla
So sir, what would be the impact on our bottom-line, we say we would be providing for the employee benefits in the JV entity?
Mohit Narayan Saboo
So we have provided for all other entities, maybe it’s let out of JV entity, but I don’t think it will be a huge impact because most of the employees in the TV company are fairly new and would not impact majorly on the bottom-line.
Jay Shukla
Okay. So it would be a rounding error if you can say that.
Mohit Narayan Saboo
Yeah, we will be providing for the same in the current quarter with out, I’ll just check with the account for the same.
Jay Shukla
Okay. Okay, got it. Got it. And sir, when we say that we are seeing higher demand for the panels as well as AAC blocks from industrial usage or building factories, etc. So can we say that the 15% of revenue mix which we have from the industrial side is — might it see a rise in the coming future?
Mohit Narayan Saboo
Yes, definitely. We have — so earlier if I talk about couple of years back, used to have maybe 2%, 3% or 5% volume from industrial sales, which has gone up to almost 15% 17 percentage in the last couple of quarters. And yes, with the upcoming growth of of manufacturing in the country, I feel we can be able to increase the share of sales in our company.
Jay Shukla
Okay. And would our margins improve when we — when we sell to the for industrial development or would it be better in case if we sell it to the regular residential or commercial builders?
Mohit Narayan Saboo
So for AAP blocks, the margins will remain almost at the same level, but for AAC panels, the margins are comparatively better for it. To the industrial and also segments as well..
Jay Shukla
Understood. Understood. And sir, just a follow-up question for the revenue side. Are we seeing higher revenue numbers or higher demand as compared to the previous year post the December quarter, let’s just say from January onwards
Mohit Narayan Saboo
The demand uptick has been somewhat water since January quarter because the Maharash elections have also been over and now this is almost a big period for construction activities
Jay Shukla
Okay, got it, got it. We are targeting to increase our capacity utilization by another 5% to 10% in the coming quarter. So by when will the or better? Okay. Is it better now yeah, is it? Is my voice better now?
Mohit Narayan Saboo
You are breaking the voice it should be better now so my point was when we say we are planning to increase coming quarters. When are we targeting to utilize the new facility to the 80% 85% of the
Operator
I’m sorry to interrupt. Your voice is not clear.
Jay Shukla
Sorry ma’am, I’ll ask my question in some other. No worries.
Operator
Thank you, sir. Now I hand over the floor to Mr Mohit Sabu for closing comments you.
Mohit Narayan Saboo
Thank you everyone for participating in this earnings con-call. I hope we were able to answer any questions satisfactorily and at the same time offer insights into our business. If you have any further questions or would like to know more about the company, please reach-out to our Investor Relations Managers at Valorem Advisors. Have a good day. Bye-bye. Thank you.
Operator
Thank you, sir. Ladies and gentlemen, this concludes the conference call for today. Thank you for your participation. You may now disconnect your lines. Thank you and have a good day