Note: This is a preliminary transcript and may contain inaccuracies. It will be updated with a final, fully-reviewed version soon.
Nuvoco Vistas Corporation Ltd (NSE: NUVOCO) Q3 2026 Earnings Call dated Jan. 16, 2026
Corporate Participants:
Bishnu Sharma — Head- Investor Relations
Analysts:
Unidentified Participant
Unidentified Participant
Unidentified Participant
Satyadeep Jain — Analyst
Rajesh Ravi — Analyst
Unidentified Participant
Prateek Kumar — Analyst
Naveen Sahadev — Analyst
Presentation:
Operator
Ladies and Gentlemen, good day and welcome to the Novok of Vistaf Corporation Limited Q3FY26 earnings conference call. 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 conference call, please signal an operator by pressing Star then zero on your touchstone phone. I now hand the conference over to Mr. Bishnu Sharma, head of investor relations from Nuvoco.
Thank you and over to you.
Bishnu Sharma — Head- Investor Relations
Thank you SSC. Good evening everyone and warm welcome to. Novapore’s Q3FY26 earnings call. The result along with the earnings presentation. Has been uploaded to the Stock Exchange. Website yesterday and I hope you had a chance to review the key numbers. Let me first share the key highlights. For Q3 FY26, after which we will open the floor for questions the quarter began on a challenging note, but as we progressed we started to see encouraging signs of recovery in overall demand. This improvement was particularly visible in the latter part of the quarter as the impact of earlier macro headwinds began to subside.
Increasingly, capital expenditure by both central and state governments seems to have gained momentum supporting infra activity and cement demand. With this gradual pickup, the broader demand environment appears to be slow strengthening, setting a constructive tone for the quarters ahead. That said, a significant portion of the plant spending is yet to be exhibited. Around 45% of Central Cafe and nearly about 61% of State Cafe remains pending as of November 2025. The Healthy Pipeline of spending projects gives us comfort that this traction could continue in the coming months.
Additionally, amps and above normal monsoon, a software interested environment and growing consumer confidence, particularly in rural areas, further reinforce our outlook for sustained demand growth going forward. Now turning to our performance for the quarter, we delivered robust results despite the. Early challenges from macro headwinds. As mentioned earlier, volumes grew 7% year on year to 5, the highest QC volumes ever recorded in our company’s history. December was particularly strong with volume growth of 20% demonstrating our strong existing capabilities and the resilience of underlying demand.
EBITDA for the quarter rose approximately 50% year over year to 386 crores. Even its price moderated more than the benefit pass through or in the revised GSP rate. Coupled with macro headwinds, our emphasis remains squarely on premiumization cost efficiency which significantly lowered the impact of the price moderation. We are pleased to report that the. Premium products sustained their share of trade. Volumes at a historic high of 41%, marking the consecutive quarter at this elevated level, we have consistently expanded our premium base over time.
For the nine months of FY26, premium stood at 43% reflecting a steady uplift of nearly 300 basis points over the FY25 baseline of 40%. This establishes new stronger base for us going forward and will continue to support our performance. On the cost front, we continue to efficiently manage our operational cost as we achieve the lowest branded cost in the last 17 quarters at 1.41 per ampere. Despite the recent uptick in petcock prices. Raw material cost curtain distribution cost per turn also declined quarter on quarter supported by operational efficiency gains coming to cement prices.
Given the improvement in demand conditions and positive outlook, the company undertook a price increase in January which is expected to further improve our performance going forward. Let me now turn to the balance sheet. During the quarter we raised 600 crores through CCD expenses which were utilized to replace an equivalent amount of short term bridge financing thereby reducing overall debt level. We expect to complete an additional 600 crores CCD expenses in the near term to substitute the remaining 600 crores of short term risk financing.
Our continued focus on a disciplined approach to debt management reflects prudent capital allocation and will support the company’s growth agenda going forward. Let me briefly touch upon the Bharraj Cement plant. The refurbishment and project execution remains on schedule with operationalization of Clinker unit and grinding unit planned in phases from Q3FY27 to Q1FY28. To give you a quick update on our project assumption, we have made steady progress at both Kutch and Surat. At this site, key equipment is undergoing extensive overhaul.
The engineering, tendering and ordering of all goods and service packages at Surat are now complete. While activities at Kutch are progressing as per schedule. Deliveries on the electrical and instrumentation front. Remain on track for both locations and mechanical supplies have already started arriving at site. We’ve also applied for all the required permits to operationalize this plan in line with our planned timelines. On the logistic front, the engineering skill plan and detailed project report for the Kutch railway line have been submitted to Indian Railways and the execution order is now at an advanced stage of processing.
By the first half of FY27 we expect to complete the overall work and equipment installation followed by trials in accordance with OEM protocol. We will subsequently establish operations from the control room. Accordingly, during FY27, Surab Grind unit and Kutch Clinker unit will become operational while in H1FY28 first grinding unit will get commissioned. The East Expansion projects of adding 4 million tonnes per annum in phases also remains on target. With the east expansion and commissioning of Bhattraj plant, the company’s total cement capacity will scale up to 35 million tonnes per annum.
Both the ongoing expansion at Batraj and the east expansion, the company’s growth agenda will continue With a firm focus on balance sheet discipline. We have several strategic options ahead including expanding our presence in the north through a brownfield project or pursuing a greenfield development in the Gulbarga region aimed at strengthening our position in the western and central market. Furthermore, our recent preferred bid status for the GMK R2 limestone block in Jospur and Pali NND or mining reserve base providing a strong platform for future expansion.
Lastly, to briefly highlight our ongoing baseization efforts, we have further strengthened hesitancy and. Transparency throughout the operation. Our Customer portal now handles approximately 99% of the total order offering real time control and precision in order management. Following its success in cement, we launched Customer portal for our MDM business tool. During the quarter, we introduced Nuvoco 0m Unati app under NVM to digitize influencer loyalty driving higher engagement, greater transparency efficiency and data power channel growth.
On logistics, the Transporter portal now covers inbound and outbound logistics across all plans, delivering end to end visibility while minimizing manual interventions. That concludes my opening remarks. I’m here with Mr. Jayakumar Krishnaswamy, Managing Director of Nuruk Vistas. Mr. Manish Agarwal, Chief Financial Officer. We’re happy to answer any questions. Over to you, Mr. C.
Operator
Thank you, sir. Ladies and gentlemen, we will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on the Touchstone 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 a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. We will take our first question from the line of Jashandeep Singh Chadha from Nomora. Please go ahead.
Questions and Answers:
Unidentified Participant
Hello. Can you use
Operator
Your handset mode please? Your line is not very clear.
Unidentified Participant
Yeah. Is it better now?
Operator
Yes, please go ahead.
Unidentified Participant
Yes. Yeah. Hi. Thank you for the opportunity and congratulations on a good set of numbers despite, you know, pricing. Just wanted to understand a couple of things. Firstly, you mentioned that no took a price hike in this month. So wanted to understand when did you take that price hike and how much was the price hike and is the price hike sustained in the market. First question was that if you can, you know, clarify that then I’ll proceed with my next question.
Bishnu Sharma
Yeah I guess after a three. Quarter. Three in terms of pricing, January, December or not demand improved and then the sustained demand continues in January as well. So around 10 to 12 around that time we have taken a price rise in non trade across the geographies in the month where we operate and also in trade channel we attempted a price increase in east as well as north. We’ll have to wait for a week or so to see whether the price rise which we have taken sustained but as of now things look positive.
Unidentified Participant
And has the demand tapered off after the price hike or the momentum continues which you saw in the first 10 days.
Bishnu Sharma
Other than the 1415 these are. All festive times so I guess I’ll have to discount 2 days before and today I guess demand in the first 1012 days of the month so give. Or take I think typically after Sankranti. Demand improves in all the regions so. That’S been the path trend so it. Should continue to improve going forward as well.
Unidentified Participant
Okay, my second question is cost. Novoco has been doing impressive cost numbers now recently we have seen techcoup prices going up. So I wanted to understand in the fourth quarter what will be the impact of that and going forward as well and also if you can shed some light on your capex plan, you know the amount for next year FY27 28 and how should we look at this?
Bishnu Sharma
Yeah, as Vishnu mentioned in his initial comment our fuel cost rupees per million cal trended at 1.41 in Q2000 which if you could have seen in the last many quarters we have come to around there about kind of a number for a few quarters now we will continue this trend. Already petcock prices have gone up in. The month of December and including I. Am talking about the current trend of. Pricing I guess in Q4 I am still looking at similar kind of number give or take little bit of 0.01 or something like that but that’s all insignificant changes that may happen.
These are basically backed up by two. Three aspects of the company. One is to work on our AFR agenda in north the two plant customers in Rizla. The second one is using domestic open market coal for the first time in the last many years. In the preceding quarter we have started. Using good amount of domestic open market. Coal in our north plants and that kind of helped us sober the cost lines of fuel in north as well as increase the domestic open market coal actually in our east plant. And last but not the least our focus has been to kind of reduce.
The Petco consumption from high of 48% all the way come down to 41% now which is an impressive number. With this kind of Petco production we. Will be able to offset the rise in Petco crisis if any. And also our teams have been very. Innovative in trying to use what do you call power plant reject coal and as well as coal washer and reject coal for our CPB plants bringing down the power cost of CPP from close to about 0.9 0.95 rupees per million Kaldo as low as 78.8 rupees per million Kelly. So basically substitute reduce Petco consumption.
Second is get increased focus on AFR. And last one is to kind of work on CPP coal. With all these three initiatives I think. We should be able to defray the potential increase in Petco prices at prevalent. Levels in the unlikely event of a big time increase. I guess that’s going to be a. Challenge for the entire industry. But as we see today, we have. Fuel stocks for a month or two right now and with the field stocks which we have we should be able to save through quarter four. And on the second point about Capex.
Plans, in the previous call we had spoken about the overall CapEx outplay for the company. Obviously we have the Capex for the existing operations as well as Capex for the Vadraj. So overall this year as of nine months we have spent close to about 320. 320 crores of capex as of December and in the balance three months we should be able to spend. We should be spending close to about 200 odd crores. So for the full year the Capex. Outlook is coming anywhere between 620 to 630 crores.
Unidentified Participant
Okay and then if I can squeeze in one last question, a lot of advantages that you mentioned especially on cost front are you know in the eastern assets. But when we start in a lot of these advantages will not be there. So in the initial years can you give a sense of how much the cost might increase? You know as capacity ramps up?
Bishnu Sharma
What happens when Madras starts? Okay,
Unidentified Participant
So
Bishnu Sharma
Bhadraj starts. Look anyway Bhadraj is going to be. Run on petcock fuel for kiln similar to our nimble and Chittor. So the ballpark number will be same as what Chittor and Nambour numbers of terms of fuel cost per kiln. The other advantage is what are that area we have lignite. So the captive power plant is going. To be based on lignite as A fuel. So when we have done the initial. Calculation our energy cost for Madras plant. Other than the startup challenge of starting a new plant, other than that I guess in terms of somewhat steady state.
Our fuel cost, energy cost, it will. Also have a CPP similar to what. We have in Sisur and Nimble. So it’s kind of a copy of our north operations. So the cost lines of Madraj in. Terms of power and fuel will be more or less same as what we get in Nimble and as we start the plan.
Unidentified Participant
Understood. Thank you so much for joining. Back to you.
Operator
Thank you. We’ll take our next question from the line of Amit Murarka from Access Capital. Please go ahead.
Unidentified Participant
Hi, good evening. Thanks for the opportunity. So just a question on leverage. So in the presentation I think you see you have shown debt at 4270 crore and plus 600 crores as short term bridge loan in CCD. So just wanted to understand a bit more about the CCDs as to what are the conversion terms and by when does it come up for conversion.
Bishnu Sharma
It’s. During the last call and the one before. We have already said that now when Noco reaches 3500 to 4000 crores that’s when we kind of start our next expansion which that’s how we started the entire Vajraj process. And the entire fundraising bid for Vajraj was we had to pay 1800 crores as an acquisition cost for Vajraj. So to get that 1800 crores funding. So we had started with 600 crores of long term debt and another 1200 crores of bridge financing till the CCD route was decided by the organization.
So first I’ll explain the 600 crores. The 600 crore sits in this 4217. As mentioned in our investor presentation the. 4217 crores debt level at December 25th has built in number of 600 crores. So if you have to do a. Like to like comparison of our past periods this number is 3617 and with compared to December last year it was 4350. And that’s the kind of debt reduction deleveraging company has been able to do in the last few years. So 3617 add 600. 4217 and that 600 is set in. Our books as a long term debt for Madraj acquisition.
We mentioned that the 1200 crores will. Be in the form of a CCD. I will ask Manish to explain how we have Gone about doing the 1200 crores in two 600 crore tranches. So in terms of the specific
Unidentified Participant
Terms of the CCD which is the transit that has been done in the month. Of number as one of the query. So basically there is a call option and a put option as a part of the ccd. So will have the call option and. Will have the right though it’s not an obligation to buy out the investor depending upon our balance sheet position at that point in time and the market conditions. So basically this call option is sizable at the end of the fifth year. The at the end of 5.5 year. And at the end of the sixth year.
So this C series are for a. Period of seventh year. And so as I said the one option is after five and a half six years. So these six 600 crore C series A, this is into three tranches of 400 crores each that I’ve talked about and it is mandatory, it gets converted into EPID at the end of seven years and it carries a coupon rate. Of 0.1% in the.
Bishnu Sharma
Yeah, the system had code just to. Make it a pickup from money. So it gets consummated at 7, 5 years plus at the time no code balance sheet will be much stronger than where we are currently. So we have the call option at the time and it’s as it’s under 200, 200, the second 600 crores. We have still not completed the long term, short term debt into CCD I guess due to year end holidays in the market. So we still and the discussion should be concluded in the coming days.
Unidentified Participant
Okay. Okay. So what I understood is that it is compulsory convertible into equity at the end of the seventh year.
Unidentified Participant
That’s right.
Unidentified Participant
And what would be the price at which it gets converted?
Unidentified Participant
So I think you can take these. Things offline or separately from the investor relations department. So as I said it is a call option at the end of fifth. Year, five years, six years from the workers perspective. So the intent would be depending on. The market conditions and I think
Bishnu Sharma
At that time we should have a pretty strong balance sheet to kind of use the call option and repay the ccd. That’s the idea which we have in. The most unlikely event that’s when I. Get the put option will be exercised on the promoter group company.
Unidentified Participant
Understood. So you are, you are basically the idea is to essentially repay off this in the fifth year itself and through the cash flows that you generate in this period and not really conversion into equity.
Bishnu Sharma
No, absolutely that’s the intention. I guess as we speak we would be three years from now at the CAGR of 7%. Obviously the business will grow to a much higher volume and also with the volumes coming from Madraj and with overall what they call market opportunity we should be able to generate much more cash and the balance sheet should be much stronger. And as I mentioned the kind of. Business projections which we have in place, we should also be able to fund the Bhattraj capex through internal accrual and.
Then we should be able to retire the ccd. But I just want to mention one. Other point to you is many times. I mentioned in almost all times I. Mentioned this particular point in the call. Stating that as a company we are. Comfortable operating the company with the debt levels of 3,500 to 4,000 crores. That won’t continue. We are not going to be going. Into the path of retiring all the debt. I’m sure if really business scales up to that level, this debt level also should come down. But we should also we would be able to, we have the ambition of.
Growing the company beyond Vatraj as well. So I guess we are comfortable with debt level about 2500 and at that time with EBITDA coming we should meet our governance. So we targeting EBITDA to debt level around 2ish at the time as well. So comfortable question to retire the CCD. On a call option and still grow the company.
Unidentified Participant
Sure. Just the last question on the CCD bid. So at the fifth year when you. Have the call option to buy the debt out, will it be bought out at 600 crores or will there be something additional that would require to be. Paid
Bishnu Sharma
That should be additional because that’s. How the whole structuring is done. Because all the so called interest adjustment will happen into the principle of 600 which is in the form of CCD and then the payout will be happening on top of all the yearly component bonder. When it comes to 5th year.
Unidentified Participant
What. Is the implied interest? I just want to understand while I understand that this is a structured transaction debt. No
Bishnu Sharma
Worries. So what will we do is to share this. So this should get into a long discussion. So may I request you to reach out to us, come over to our office or let’s set up a call. We’ll explain all of it in complete details in because obviously all of it. Is in the public domain. So we should be able to give you all details. So anything that is needed, reach out to us. We should give you every bit of detail.
Unidentified Participant
Okay, sure, sure. Thank you so much.
Operator
Thank you we’ll take our next question from the line of Satya Deep Jain from Ambit Capital. Please go ahead.
Satyadeep Jain
Hi. Thank you. Just a follow up to this CCD question. The remaining 600 crore still wearing tire is that have you locked in? Basically the investors are more or less identified. Is it the same set of investors? Is it just some procedural delay? Just wanted to understand where are you in the process? It’s been a while since that Vagraj deal happened. Obviously you’ve closed 600 crores. The remaining 600 find out similar investors different restructuring is also going to be similar as we look at that 600 crore.
Bishnu Sharma
Yeah Sandeep, the structuring is more or. Less going to be the same. Maybe the numbers could be slightly different because it’s not going to be exactly the same set of people who will do. We are more or less at the. Final stage of this. So it is nothing to do with. Any challenge or anything which you have faced. Just that year end happened and then the thing market to the people with whom you are working have just come back. So it should happen. I can’t give you a timeline whether. It will happen in a week or.
10 days or two weeks but suffice to say that we are on top. Of it and this should happen pretty. Much in the near future.
Satyadeep Jain
Okay. And on this asset just maybe an update on the rail line. I know it had already reached Nalia. What is the status for last mile connectivity from Nalia to your plant and then from there also? Have you seen other players start basically transporting from that particular stretch or is it still in future?
Bishnu Sharma
That’s kind of more or less stitched up. The railway survey is already completed within Nallii and into a place called Wagot. Wagot is a station which is about four and half kilometers from our plan. So the survey railways started working on that and I think the land acquisition railways that is going to be done by railways. I think there initially project report says that they should be ready completing this up to this Wagord station by end of this year, December January they should be able to complete in parallel.
The whole distance for us is there are obviously other than that there are two other plants. I think they are also kind of pursuing from the same about chalk and then that’s when the line branches out to us as soon as to the other two players forest from that station to our plant outside our plant boundaries about 400 plant boundaries are already started completed. The land survey, the railway route finalization, the DPR and ESP is all Done only on last week. Wednesday I kind of approved the purchase orders for the party to work on the railway siding as well.
So it all happened parallel. So our plan is to start work. From inside the plant. Already we have control over the land. So the work will start from inside our plant compound all the way to the place where the siding comes inside our plant. And in parallel I guess land acquisition. Lot of patches of land is government land. So we are already working with government of Gujarat. So by the time work starts we should have completed the acquisition of the land. And when the railways is ready by end of this year we should also.
We won’t be able to complete the. Project by end of this year. It should take longer than that. Our Target is June FY28 is when the siding is going to be completed. So we are on top of it. On course to complete stuff. The other two guys, I guess they. Should also be working on the same lines.
Satyadeep Jain
So as of now the other two guys their plants are operational. They have this just wanted to understand because the line is there to Nadia. So have other players started shipping? And when you look at the last mine connectivity and assuming some delays have been mentioning June 28th but for at least the monsoon period it’s a fair weather port. Should we assume lower utilization for the first year till this largest connectivity Is there just maybe an update on are other people using that line? As of now.
Bishnu Sharma
The Nalliya siding is. Already being used by other companies. So I guess the Nalliya siding is. Anyway operational Though it doesn’t have any handling. Obviously it’s a manual handling loading into N box and moving the material so. That one is operational. So push comes to shove we will. Start with Nalia not a problem at all. And by the time June of next year, monsoon or late July or something, I guess we should be ready by then. In the unlikely way Nalia is always. There incur a little bit additional cost to move material.
Other than that the jetty is all Jetty road is already there. Jetty route will also be there and the Nalia route will always be there. But I think beyond June FY 28th. We should have the railway setting operating out of the plant and discharges should. Happen within the plant. So as I see today we are on top of things. Obviously in a big project like this there could always be small delays here and there. But I don’t foresee any major stumbling. Block in this because I guess backup. In Alia is there, jetty is.
We have already done the bathymetric survey. And Then we know how to kind of ferry material out of the jetty cut jetty as well. So jetty road is also going to. Be operational around the time the clinker starts production. Nalia will be ready when the clinker production starts. So that would be operational before that. So by the time siding comes by Q1 end we should be fully in business moving material. As regards to your second question of. Whether it meets the scale up of the company. So as I mentioned before, our overall.
Scale up is 1, 2, 3, 4. That’s the kind of number which we had in mind. 1 million in FY26 which is we. Will exit the year at a million. Kind of annualized million sale in Gujarat. Next year we should be going into by end of the year we should. Get into 2 million share and FY29, FY28 will be 3 million and FY29 will be 4 million. So that’s the broad plan which we have. We are on course to achieving and delivering those 1, 2, 3, 4 agenda.
Satyadeep Jain
Lastly on Gujarat specifically because you’re entering expanding there in a big way, I know you’re catering to that market right now, the 1 million ton that you mentioned. But would you have to as you look at bringing more volumes, when should we look at maybe upscaling your branding team before that capacity comes online? Is there something you need to do to strengthen your position or branding or team there in that region? And when do you start to do?
Bishnu Sharma
I guess it’s all about timing because I spend start spending money right now. I will be wasting money. If I spend late, I’ll be losing an opportunity. So we have a clear blueprint in place when to kind of get into. Investment mode in terms of market investment and media investment. But what are the things which you already done? We have a full fledged sales force in place. We have the sales offices in place. We have the market study done and then dealer appointments or started happening. So by the time.
Even month of. December we already sold in the state. Of Gujarat 1.2 lakhs. And our target in Q4 is going to be similar kind of numbers every month. So we have kind of scaled up to this kind of 1.2 would already mean more than a million ton of. Sales will happen in the first year itself. So that will not that sale cannot happen unless until you appoint dealer network. Which is already there. But as regards advertisement, marketing and other spending. So I guess we have a blueprint in place. But in this fall I won’t be.
Able to tell when I’m going to break but certainly on top of things. And by the time our solar grinding. Unit is operational we should be having all this in place in the market.
Satyadeep Jain
Okay, thank you so much and wish you all the best.
Bishnu Sharma
Thanks.
Operator
Thank you. Next question is from the line of Rajesh Ravi from HDFC Securities. Please go ahead.
Rajesh Ravi
Hello.
Unidentified Participant
Hello.
Rajesh Ravi
Yeah hi Sir. Good afternoon. Good evening. My question pertains to the fuel and power cost. This 1.41 when you say per million cap this is inclusive of your thermal CTP power cost. This is only kiln fuel cost.
Unidentified Participant
This is kiln fuel cost.
Rajesh Ravi
This is kiln fuel cost. Okay. And what will be your in the kiln fuel? What would be the linkage and petcoke and other coal mix?
Bishnu Sharma
Petcock on the kiln as we mentioned is Q3FY26. We have delivered 41% PetCoke is the. Pet coke usage in our kiln. This has got a higher load in north and a lower load in east. There’s a blended load for the company has coal at 41%. We were at a similar time last year Q3FY25 we were at 48% Petco. We are at 41% Petco. Linkage coal is 34%. Non linkage domestic coal is 15%.
Rajesh Ravi
Okay. And AFR would be the remaining AFR.
Bishnu Sharma
10% is Q3FY25th here we should improve because last one and a half months we had two main plants RIZZA and Nimble under shutdown. So both these plants have the AFR facility. So the number is slightly low. Before shutdown of these plants Nimble was already at 15% and Chittor was already at 15%. So I guess some ramp up time will take in the next three months. By Q1 FY27 we should be able to get this number to anywhere between. 13 to 15% at a company level.
Rajesh Ravi
Understood. Logistics cost this quarter has come down. So there is any reduction in lead distance or what specifically has led to correction in your logistics cost?
Bishnu Sharma
Our lead distance in Q2 was 331. We are at 326km this quarter. There’s a good reduction of 5km. Most of the reduction has come in the secondary side and impact is due. To the secondary size reduction where the. PDPK is more than the primary PDPK. And that’s one reason why our logistics cost has become efficient in Q3FY26.
Rajesh Ravi
No, because if I look at from Q1 Q2 level it is down almost by 7080 rupees per ton. If I look at the average of H1, it was 1525. Now it is 100 rupees lower in Q3. So what explains this?
Bishnu Sharma
Three things. One is lead distance which I mentioned. The second one is all our primary. Freight has got GPS fitted now. So we are running a very tight. System to ensure that any potential leakages in primary is. Reduced to a big extent. And third most important thing you would have also we have mentioned in the a year ago, two years ago we started the Sonadi and Jajpur railway trading. And for the Jajpur plant by road that’s totally eliminated. Now all clinker movement in east is. Happening only by rake.
So that’s a big savings. In terms of clinker distribution cost has come down which is we have all the on time. We had mentioned in the previous call. That the distribution clinker movement cost should. Come down anywhere between 25 to 35 rupees. Kind of a number that added to. Lead distance reduction GPS implementation. And last but not the least increased. Focus in Chhattisgarh sales and Rajasthan sales. Has also reduced the overall lead distance which is composite multiple reasons to explain the reduction in distribution cost.
Rajesh Ravi
So how much is your rail share now which was 40% in Q2?
Bishnu Sharma
I can give rail share for the country as well. Just give me a second. Yeah,
Rajesh Ravi
Yeah. Total on a total basis
Bishnu Sharma
Our road. Share, rail share is 37% and road. Share is 63% 9 months FY26 and. That Q3 also is 63. 6337.
Rajesh Ravi
Okay, understood. Okay. And so lastly on the power cost, your green power mix is holding up around close to 20%. Okay, what are the opportunity there to increase this? Because most of your peers, they’re all inching up to 40, 50%. So can you give me a breakup of your power, you know, power usage grade CPP and you know renewable power and what is the spot there?
Bishnu Sharma
Currently our CPP is 150 megawatt and. WHR is close to about 43 megawatts. Put together we are at 195. 196 megawatt. Our plan is to de bottleneck all these WHRs to get another 3.5 megawatts. In the next six, eight months. That’s the number one way to increase the green power. We also have very small solar power. In Chitore factory and. A very small one. Along with that we have a 1. Megawatt solar power in Biwani and 1 megawatt solar power in Jatpur factory. So these two are the current initiatives.
But in the last one month we have signed an LOI with the company. To set up a hybrid power plant in Rajasthan. And that should be operational in the next 12 to 18 months which should be a big. Which should give us a big boost to power cost in nimble plant. And that’s a 50 megawatt hybrid model which we working which should be one of the large investments which we are making going forward. It will not be a capex model. It’s going to be group capital model which we have concluded very recently. And that work should start very soon.
Rajesh Ravi
So 50 megawatt will be the installed capacity. And it is solar, right?
Bishnu Sharma
It is a hybrid. Solar plus wind.
Rajesh Ravi
Okay. No, I just wanted. Why? My question is the you know most people are doing this re power through JB mode to reduce their landed power costs. So you know what sort of power cost reduction. And given that many companies, if you see your few competitors have recently invested 45 crore with a payback period of you know what we understand these daily projects have a payback period of less than two years. So is it not an opportunity for you to invest into, you know invest say 100 odd crores through JV models and increase your green mix from 20 to 40% plus and in turn also reduce your blended power cost by say.
You know, one rupee odd
Bishnu Sharma
Very much. I think Rajesh is very clear. If you really look at where all. We operate, we operate in Rajasthan. That’s a big cluster for us. Chhattisgarh is the second biggest power consuming place. And the third one is West Bengal where we have two Gus. So our highest power cost for the. Company comes from Rajasthan. Both because of Petco cost as well as the overall power cost in the place. And the rules of Rajasthan got changed only recently. As soon as the group captive and. The banking model came into economically right strain.
We have gone ahead with this. This group captive model of putting up. A plant exclusively for Nimbol. What we do in the second plant. Is based on our experience of Nimbo. That’s the first thing. When it comes to Chhattisgarh, the first thing which is important for us is we run on a. What we call linkage code is a big component in Chhattisgarh. And the second one also is all the three plants. Great integration in Chitto. Not Chitto. Sorry. So what we learn is all these three plants run on a grid.
And we many times we shut the TPP to use the grid or we shut the grid and use power from. One factory to another factory. It’s a common grid and we have. Got a solid benefit out of it. The payback was close to only seven, eight months and more or less the job is done. We will go for a captive plant in Chhattisgarh. Once the economics of captive plant outweighs the savings which you are making out our current model. So it’s very much in our agenda. It is economic which will drive at. This point of time.
Unidentified Participant
Last lead
Bishnu Sharma
Is Bengal. Bengal. Still the group captivist model is not working. Because the rules of that place does not facilitate what we have in Rajasthan. We don’t have proper banking arrangement there. So once that is meant, that’s the place there will go for.
Rajesh Ravi
Understood? Understood. What is your blended power cost currently? 6, 9 months and Q3.
Bishnu Sharma
Blended power cost for the company is. Just a second please. The blended power cost for the company is close to about 335 rupees per ton.
Rajesh Ravi
25.
Bishnu Sharma
335 double 3, 5.
Rajesh Ravi
Okay. Understood sir. That’s helpful. Thank you, sir. All the best.
Unidentified Participant
Thank you.
Operator
Ladies and gentlemen, in order to ensure management is able to answer queries from all participants, kindly restrict your questions to two at a time. We’ll take our next question from the line of Pratik Kumar from Jefferies. Please go ahead.
Prateek Kumar
Yeah. Good evening. Congrats for great results. A couple of questions. Firstly on your premiumization mix and increasing rate over last few years. How do you think your gap has closed versus gap has closed or increased versus other strands in the market? And how does increasing premium mix contributes to your EBITDA portal?
Bishnu Sharma
Just. I’ve got some. We’ve got some bragging rights on this. So certainly from FY22 till FY26 nine months. Our premiumization percentage is a percentage of. Trade volumes have moved from 34 to. 36 to 37 to 40 to 43 and Q3 we had 44% of premiumization. We have Concreto which is a flagship premium brand. We also successfully launched Concreto Uno in Bihar, Bengal and Jharkhand. And the Duraguard microfiber is sold in. Chattangarh, Orissa, Rajasthan, Western mp, Haryana, other north markets and also in Gujarat.
So that’s something which if you look at rest of the other companies, I’m not going to rat load other companies. I think they are at a different level. We are at a different level. Certainly going forward this will be a source of strength. We will further strengthen in FY27 and beyond. Certainly to increase this number. We are really looking at increasing this. Number certainly at 200 basis points every year in the next two to three years.
Prateek Kumar
Sorry, my question was regarding how your net realizations or market rising would be have increased or gap on a better side versus your competition during this period and contribution of better premiumization on a better pattern.
Bishnu Sharma
At the premiumization level we have to. We can’t look at an all India level because premium station has to be calculated the base product in the state and the premium industry contribution changes from state to state. Suffice to say that at the premiumization. Level we can get anywhere between 150 to 200 rupees increased contribution per ton of cement sold. So that’s a big boost. And as we go forward this will provide us leverage to overall improve the realization for the company.
Prateek Kumar
Okay, and my other question is on your 4Q. So we have like seen like acceleration in demand growth for your company based on current trends. Because we had like a very high performance base in Q4 last year. We look volume growth accelerating from 7% this quarter. And also a related question on pricing. How is your pricing undertaken on 1012 January compared to the exit price of December quarter?
Bishnu Sharma
Yeah, I guess first one is in. Terms of Q4 obviously our base was high last year. We saw sold 5.7 million tonnes in Q4. So I’m really looking at good growth. If you remember my previous call in Q3 I mentioned that demand for the industry should be anywhere between 7 to 8% kind of a number. So we hope to kind of hit that number or cross that number certainly going forward. That’s on the demand side basic side. But I guess Q4 overall cement industry also peaks and then we will certainly ride the demand perking up second in.
Terms of the price increase and the impact of price increase. As I said as an answer to the first question, pricing corrections we took around 1011 of January. So north date prices have moved most markets trade prices also have moved in certain markets. I’ll have to wait for the next. Week or 10 days to see whether these prices continue to remain where it is there I see no reason why prices coming down from where we have taken because these prices have to sustain going forward. And also in a quarter where demand is going to be pretty robust.
Prateek Kumar
Thank you sir and all the best.
Operator
Thank you. Take our next question from the line of Tejas Pradhan from Citi. Please go ahead.
Rajesh Ravi
Yeah, hi sir. So you had mentioned that you will be expecting 7 to 8% demand growth in fourth quarter. Now from fourth quarter last year if I’m not wrong, we operated at 90% plus capacity utilization and I assume there’ll be a regional skew over there. So how are we placed in terms of having capacity available both from grinding and clicker capacity perspective to sort of meet this demand growth that could be. There,
Bishnu Sharma
We have to divide our market. Between eastern, north, stroke west. Certainly in the north markets sourced from Chittur, Nimol, Biwani we would be operating at near capacity utilization in Q4. That’s very clear. The only way we can get more volumes is to to go more and more into blended cement even in non trade category. And that’s our goal in Q4, to kind of get our year 6 million tonnes of capacity. We will set our assets to come very close to that number. However in these we still have lot of headroom.
Our installing capacity needs is close to clinker capacity, not installing capacity. Clinker capacity is close to both 20 million tons at CK ratio of. So one of the goals here again. Is taper down the OPC levels in non trade and go hammer and toms on trade levels. We have sufficient headroom in each to kind of get the growth this year. Even next year a double digit growth. And year after also a double digit growth. So certainly suffice to say for the next two and a half years we have adequate capacity needs to kind of.
Strengthen assets and get the volume growth going. The other one which we will certainly. Work on is get into more and more blended cement, get into more and more slack cement also concrete owners of composite cement, it’s a premium composite. So we’ll more and more switch over from plain PPC or plain PSC into composite to do clinker release. So clinker release will be an agenda going from OPC to blended cement. Whatever little we do. This second agenda, sufficient headroom to grow certainly in Q4 and beyond.
FY27 and 28 also we have adequate capacity in the east. North will be a tight scenario after this quarter. We’ll continue to operate at near capacity. Utilization in north and that’s one of the reason Vajraj will come into play. Once Vadraj capacity comes into play we. Release close to about 1 the current. 1 million tonnes sail in Gujarat into. North markets and certainly get to serve Gujarat as well as West Maharashtra also. Some bordering portion of West MP also will happen from SOL factory. So all in all the entire expansion strategy is to release capacity in north and east.
We are self contained for the next. Two to three years.
Rajesh Ravi
Okay, so just to add on to that. So if I look at the presentation, the cement to clinker ratio for 9 months is mentioned at 1.72x at the company level. Could you break this down into east and north? What could be the CK ratio in those regions? Yeah,
Bishnu Sharma
East will be close to about 1.95 to 2. North will be about 1.3 to 1.35. So we’ll have to further improve north from more way from OPC to ppc. I guess that’s going to be the. Focus in the coming two quarters to release cement. And because there’s growth in the market we’ll have to move away from not trade into trade and move away from OPC to bpc. We hardly sell any OPC in trade. So whatever little non trade, OPC will move from non based on contribution of course into BPC east certainly at 2. We still have headroom to go to 2.1 in certain market.
We have done 2.1 in the past as well. We should go to 2.1 very soon so that there again I think we will curtail the OPC sales in non trade and go out and out into PPC or move from PSC into composite.
Rajesh Ravi
Okay. And in the interim do we have any scope for any debottlenecking or. We have already sort of exhausted the. Likely sort of no
Bishnu Sharma
Limit as we speak right now. I don’t. We don’t have any debottle making plan in East India. However the cement capacity increase of 4 million tonnes grinding will help us more grinding capacity closer to the market to get this capacity going in the market. And also the Chhattisgarh GST benefit will. Help us garner a little bit more money by the debottlenecking in Rhmeta. The entire composite cement agenda, blended cement. Agenda for the company is the reason for doing the expansion of grinding units in East.
Rajesh Ravi
Clinker perspective. I was taking from a clinker.
Bishnu Sharma
East we have debottleneck. Our installed clinker capacity is close to 9.5 million tons. So we can always get the squeezing done to point where at this point of time I’m not focused too much on increasing capacity from 9.5 beyond simply because I have headroom. Even with 9.5 at 2.1 CK ratio I can go more than 20 million. Tons at east and I have adequate. Cement at 2 million 10% growth for. Next three years I have adequate cement capacity unlocked for East. Maybe same time next year we can think about debottlenecking.
We don’t have plans to put a full fledged clinker line in east at this point of time. But maybe I think as the year progresses and we come into next year we can look at that in north debottlenecking. Certainly we will do. We already debottlenecked nimble from 4,500 and to 6,100 and that’s a big debottling exercise. We did Chittor factory used to be 5,000, we went to 6,100. But right now I don’t have any plans to increase the clinical capacity. Not from 6250. 6250 is 12,500. Bhadraj will be the one which will come and help my clinical capacity.
Rajesh Ravi
Sure. Thanks. And just one last question from my side. What would be the like cost of borrowing for the company as of now?
Unidentified Participant
Just a second. So it is currently in the range of around 8%.
Rajesh Ravi
8%. Okay. Thanks a lot. Thanks. That’s it. So much.
Operator
Thank you. Participants are requested to restrict their questions to two at a time please. Next question is from the line of Shravan Shah from Dollars Capital. Please go ahead.
Prateek Kumar
Hi. Thank you sir. Just to summarize. So at a blended level and given the 3 million ton the capacity that will come up particularly this east one so 1.1 million ton I hope will be coming by March. Jose Vera and Jajpur and Panagra will be coming by this March and maybe 1 million ton dashboard by 1QFY27 and plus 2 million ton Surat also will be coming up and will be available for the second of FY27. So at a broader level this fourth quarter at least we should be doing 7, 8% growth. And for next two to three years as you are highlighting at a blended level closer to our double digit growth is doable.
Bishnu Sharma
Absolutely. I guess. You say you summarized everything what I wanted to tell. Certainly in Q4 our target should be. What you mentioned and next year and. Beyond we are targeting a stage year. Of 10% volume growth at least for the next two years if not more. Surat will give us Govindran will give us benefit in east in north and. East with the Jojobala debottle more or less it is going to be ready. I guess in the next two months. We should have Jojobara expansion completed. Jaspur expansion, Panagar expansion work has started.
We have the. There is something called NIU approval. So we are working with the governments for getting the no load increase approval which is happening currently. And side by side the modifications are happening in this B plant RS Meta. Deporting it needs a little bit longer. Suppose it involves putting up a Totally. New mill that should be available in FY28. FY27. Certainly user expansion will be completed early part of FY27 and even I guess. We should be ready By Max Max. Q2 but certainly end of Q1.
Prateek Kumar
Okay. Okay. Okay. Got it. Second sir, to summarize in terms of the cost including the even the startup cost for the Vazaraj. So from here on in terms of the at a company level in terms of the cost saving how one can. Look at.
Bishnu Sharma
This is our annual operating plan time. I guess when we meet in 4Q. Numbers I’ll be able to share the. Next 2 to 3 years cost saving agenda for the company we are currently working. So next time when we meet I will be able to share with you the next two to three years cost saving agenda.
Prateek Kumar
Okay. FX you have mentioned for the fourth quarter for FY27 and 28 if you can. Because I think the capex was slightly getting postponed to FY27. So for FY27 28 if you can sell the CapEx number.
Bishnu Sharma
27 I’m looking. At the overall capex of close to about thousand crores. And FY28 close to 700 crores. 26 will be 650. 650 to 650 crore. What I mentioned 620 to 670. Let’s take 650 as FY26. FY27 should be anywhere between thousand to 1050 crores. And FY27 will be anywhere between 650 to 700 crores. This will have Vajraj Capex which will come. We already spent close to about 200 crores in Vadraj. By December we should have another. 300 crores. 250 crores which will happen in the. Next 2 to 3 months.
Then on next year about 800 and the year next another 500 for Vadrajarat. Rest will be routine capex. So Overall summing up FY26 our capex will be 620 to 670 crores. You or take 50 crores here and there. FY27 will be thousand to eleven hundred crores. FY28 will be 650 to 700 crores.
Prateek Kumar
So sorry
Operator
To interrupt. I request you to join back.
Prateek Kumar
I am just completing that. So does that mean. Yeah. So does that meant that we are not factoring any kind of a capex for Chito got expansion. So that should be happening in the FY28 at least. So.
Bishnu Sharma
At this point of time it’s. Too early for me to say when we will start. Either we’ll start in FY28 or FY29. It could be give or take one. Year here and there. But I think let’s get into FY27. H2 of FY27. We will give you clarity on when do we start because we’ve got still objects like Vishnu mentioned. Is this opening remarks. We have options with Gulbarga, we have options with Chichorgarh. We have the Nimbahada mine. We also have the JMK mine in Jodhpur and also have the Gulbarga mine. So we will decide closer to the date where we will expand.
Either a greenfield expansion or a brownfield expansion. FY28 onwards it will start. But it’s too early for me to say when I am going to put money to the H2FY28 or Q you on the FY29.
Prateek Kumar
Okay. Okay, got it sir. Thank you.
Operator
Thank you. Take our next question from the line of Naveen Sahdev from ICICI Securities. Please go ahead.
Naveen Sahadev
Yeah, good evening and thank you for the opportunity. Hello. Am I audible? Yeah.
Operator
Yes, please go ahead.
Naveen Sahadev
Yeah, great. Thank you. So two questions. One was on the industry wide pricing. So as you said you’ve taken some price hikes in January now and you also mentioned that December as a month, not just, I mean it witnessed a double digit kind of a growth. And I think our channel six are also indicating both north and east witnessed a very decent or may I say very bumper sort of a rebound volumes in the month of December. Typically January volumes are at par to what they are in December. So my question was that if December as a month which witnessed such a sharp recovery could not give any prices, rather prices continue to reel under pressure, what gives the confidence that January would see some better pricing, please?
Unidentified Participant
Volume. Certainly from the 1st to 14 days.
Bishnu Sharma
Of the month, I guess we are tracking decent volumes. I am sure industry also demand for cement in general is pretty good in the market as January started. So I’m not going to qualify any put any adjective to the past month. But certainly I think December was a good month for us and maybe for industry once their results are published. But certainly in January I see a demand sustaining from December 2011, December 2011, 20th to 30th levels. And that’s the reason why we have gone ahead and made this changes in pricing.
So as I said earlier, this is just only what, one week into price increase time. So I will wait and watch going forward whether we are able to sustain these prices. So my gut sense is the prices. Have fallen below to GST levels because. We had passed on all the benefits. Of GST and we continued with the quarter but with little bit of a cost inflation. We had to do some adjustment and that’s how we took this correction. Non trade prices have gone quite below trade prices and that’s the reason why we took the correction in non trade.
First.
Naveen Sahadev
Understood Helpful. Secondly, a slightly long term or a midterm question. This is in with respect to the capex plans that you have mentioned. So historically you always mentioned that whenever the net debt of the company comes to, you know, in the range of 3500 to 4000 you will pursue the next CAPEX which you are doing in the in the form of Vadraj. So now since the last two quarters you’ve been mentioning medium term growth plans of Chittodgarh plant and greenfield optionality for Gulbarga. So is there any thought process as to when at what levels of debt will the company then again net debt or net debt to Ebitda will the company look to pursue these capex?
Bishnu Sharma
I still continue to say that we will pursue our growth at this kind. Of numbers in future assets but with. This kind of capex spend in the last year with Bhadraj acquisition and going. Forward in the next two years. Certainly we need to have the next set of expansion moment we complete Vadraj. But the current focus is going to be getting Vadraj, right? So we are a company which grows 100 times company. So that’s how we will progress on. This when we reach FY 28th. I guess that will answer the pre question sometime in FY28 either H2 or Q1, FY29 is when we will start the next phase of expansion.
But as I build the business plan for the company from current year for the next two to three years we. Should be in a pretty favorable position. At similar kind of debt levels two years from now for us to kick start the next expansion.
Naveen Sahadev
Noted. One question if I can speak up. Sorry. So very quickly your freight cost tends. To be very volatile. I mean it’s happening to see a decline but then it also tends to bounce back. For example in Q4 of 25 it. Had fallen on a person which is. As low as 1401. But suddenly in Q1 we saw a jump to 1550. So I’m just trying to understand. It’s good to see the current quarter’s outstanding reduction in the freight but how sustainable is this is not only a limited Question. Thank you.
Bishnu Sharma
To keep the freight cost under control, I think there are two, three levers. Which we have done certainly. I think the railway siding in Sonadi. And Jaspur has been instrumental in reducing. The. Clinker movement rate which is important. The second one is the starting of our Biwani factory. The lead distance of Haryana cement planters got positively impacted. As regards to your question about erratic behavior of trade costs, I would say that certainly from FY25 Q2 onwards till as we speak, I think gradually we are.
Chipping away the freight cost mainly. Due to three reasons. One is focusing on home markets and reducing the lead distance. Second one is what do you call the railway setting in Sonadi as well as Jaspur. But one of the principal reasons is we are a company which is on. 37% rail share and 67. As you would have seen post Covid. For the next two years the government did not levy the what you call. Freight subsidy for lean season. They delivered freight subsidy for lean season and suddenly they went back again two years and half last year, I guess this FY26 and FY25 the freight subsidy got cancelled.
Hence the freight cost increased. Because we have a certain big amount. Of rail share and the overall freight cost increase due to subsidy going away. From now on from last year, which is FY25 to FY26. I guess it’s a steady state period. You will see us progressing continuously on sustained reduction in freight cost mainly through home market sales, increased home market sale, reducing leakages through GPs, getting the clinical distribution cost between Jaspur and Sonadi. And last but not the least, one.
Of the things which also came as what you call a fluctuation in two quarters was also in certain markets we. Moved from X to for. But then I think the entire industry. Works on a particular practice. And then we add some to change the model. And that’s the reason where you would. Have seen some spikes on the freight cost. All that is behind us now. We now have a steady state market. With sustained railway with all the costs which are built going forward contains the what do you call lean season discount not happening during the period.
Number two being Sonadi dashboard siding is completed. Number three being increased focus on home markets in Rajasthan Chattisgarh where the distribution cost should come down. So suffice to say, as we go forward, we should be able to have. Efficiency improvement in logistics cost to get the maximum savings in the coming quarters.
Operator
Thank you ladies and gentlemen. We’ll take that as the last question for today. I now hand the conference over to Mr. Bishnu Sharma for closing comments. Over to you, sir.
Bishnu Sharma
Thank you for all your thoughtful and insightful questions. We hope your questions have been addressed. The investor relations team is ready to. Provide any additional clarifications you might need for the call. Before we wrap up today’s call, let me affirm our resolute commitment to driving sustained growth and strengthening our market positions. Bhattara Cement plant project execution remains on track with phased Commissioning targeted from June. 3Fy27 to strengthen our Western region presence.
Our eastern expansion, fueled by strong demand for blended cement and concrete or Endura. Guard will further enhance our erase position in the region. Looking ahead, we will continue to drive premiumization, an area where we have consistently expanded our base and set new bend paths while maintaining our focus on geographical optimization and cost discipline to enhance profitability and create sustained shareholder value. Thank you for being with us today. Thank you.
Operator
Thank you on behalf of Noco Vistas Corporation limited that concludes this conference. Thank you for joining us. And you may now disconnect your lines.