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Key Conference Call Highlights

Guidance

* Management has guided FY27E Capex at INR 35–40 Bn, followed by INR 15–20 Bn in FY28E, reflecting continued focus on capacity expansion and operational strengthening

* JKCE expects strong double-digit growth in grey cement volumes in FY27E

* Green power utilisation is projected to improve further by 2–3% in FY27E, taking the overall share closer to 55% by year-end, with the long-term target remaining at 75%

Margin outlook

* JKCE management indicated that Q1FY27 profitability is likely to remain broadly in line with the Q4FY26 level. However, the margin in Q2FY27 could face pressure if cement price hikes are insufficient to offset the potential increase in diesel cost fully

* Cost-efficiency initiatives remain on track, with the management targeting an additional INR 50/t saving in FY27E, driven mainly by higher usage of green power and alternative fuel across the southern and northern plants

Cost and pricing outlook

* Fuel cost is likely to rise by nearly INR 150–200/t, although management indicated that the situation remains dynamic, with fuel orders secured until September

* Packing material cost, which had initially increased due to higher volume and elevated price, has moderated significantly after execution of the earlier orders

* Management highlighted that an INR 10–12/litre increase in diesel price could result in an additional freight cost impact of nearly INR 50–60/t

* JKCE strategy remains focused on passing on incremental cost pressure, particularly ahead of the seasonally weaker demand period

Pricing and market commentary

* Management increased the price of white cement and wall putty to offset the higher input cost, particularly the sharp rise in chemical prices

* JKCE implemented an average price hike of nearly INR 10 per bag this month, which the management believes is sufficient to cover the current cost escalation. However, the possibility of passing on any further diesel-led cost inflation remains uncertain

* Other expenses increased during the quarter due to higher sales volume and additional branding investments of nearly INR 500–600 Mn across the grey cement and white cement businesses

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