Star Cement Ltd Q1 FY27 Earnings Analysis

- Star Cement expects a 10% to 12% volume growth in FY27 over the FY26 volume of approximately 5.3 million tons. - The company aims to increase capacity utilization to 80%-90% in new units within 3.5 to 4 years. - Expansion projects include clinker and grinding units in Rajasthan, Bihar, Umrangso, Haryana, and Jorhat, totaling around 9 million tons of cement capacity. - Capex is planned aggressively with INR600-700 crores in FY27 and INR1,500 crores in FY28 to support growth and commissioning of plants starting around H1 FY29. - Focus on maintaining premium pricing with a strategy to price INR5 to INR10 lower than the highest-priced sellers to create brand pull and dense distribution. - Realization and profitability per ton are expected to stabilize with an EBITDA per ton target of INR1,500 to INR1,700 in Northeast in the coming years, and a blended INR1,300 to INR1,400 after new capacities come online.

- Star Cement expects a 10%-12% volume growth in cement sales for FY27, building on FY26 volumes. - EBITDA per ton in Northeast anticipated between INR1,500 to INR1,700 over the next 2-3 years before Rajasthan project commissioning. - Post Rajasthan project ramp-up, blended EBITDA per ton expected around INR1,300-1,400 due to absorption of fixed costs initially. - Overall EBITDA and profits to grow with volume expansion, especially from planned new capacities in Rajasthan, Bihar, Haryana, Jorhat, and Umrangso. - EBITDA for FY26 stood strong at INR955 crores with PAT of INR390 crores, showing robust growth from previous year. - Long term capacity expansion (~6 million tons clinker, 9 million tons cement) with INR4,800 crores capex expected by FY29-FY30 at scale-up. - Incentives/subsidies expected to moderate, impacting EBITDA by about INR40-50 crores less in FY27 compared to FY26.

- Star Cement is planning significant capex for Rajasthan, Bihar, and Umrangso projects. - Rajasthan unit: 3.3 million tons clinker plant + 2-2.5 million tons grinding; total capex ~INR 2,400-2,500 crores plus 10% variation; targeted start by 1H FY29. - Bihar grinding unit to be sourced from Meghalaya clinker; timeline ~2 years, land acquisition underway. - Umrangso grinding capacity ~2 million tons; clinker production in Umrangso as it has limestone. - Capex estimates: INR 600-700 crores in FY27 and around INR 1,500 crores in FY28. - Approvals and land acquisition expected by October; capex to start post-approvals. - Focus on creating dense distribution and brand investment for new plants with breakeven over 3.5 to 4 years. - Possibility of group captive power agreements to optimize costs, especially in green energy. - QIP fundraising planned once net debt/EBITDA reaches 1.5x, decision not finalized yet.

- Star Cement has received Board approval for raising funds through QIP (Qualified Institutional Placement), but no final decision has been made yet. - The QIP fundraising is anticipated once the net debt to EBITDA ratio reaches around 1.5. - The company has not planned the exact timing for the QIP due to current weak market conditions. - They will inform investors in advance when they decide to proceed with the QIP. - No mention of any immediate or other debt fundraising; focus remains on managing existing capex and approvals. - Capex for FY27 and FY28 is planned at INR 600-700 crores and INR 1,500 crores respectively, funded presumably through internal accruals and existing resources.

The transcript provided from Star Cement Limited's conference call does not explicitly mention details about the current or expected order book or pending orders. The discussion primarily focuses on: - Volume growth guidance (10%-12% growth expected for FY27 from approx. 5.3 million tons) - Capex plans and timelines for new plants in Rajasthan, Bihar, Umrangso, Jorhat, and Haryana - Pricing trends and trade penetration in Northeast markets - Fuel cost impacts and green energy initiatives - Financial performance and subsidies impact No direct reference is made to order book sizes or pending orders in the document. For specific details on current or expected order book, the investor relations or official company communications would need to be consulted.