Shree Cement Ltd

- Shree Cement has prioritized value over volume, deliberately sacrificing volumes to improve pricing discipline, resulting in narrowed price gaps with competitors like UltraTech. - Capacity utilization is expected to improve with better pricing and increased demand, especially from government infrastructure spending in Q4 FY ’25-’26. - The company expects volume growth to resume, with 9-9.5 million tons in Q4 FY ’25-’26 and overall positive demand outlook for FY ’26-’27 (7.5%-8% demand growth linked with GDP). - Future capacity additions targeting 80 million tons by FY ’29 remain subject to demand visibility; expansion plans are cautious to avoid low utilization. - Profitability impacted by current strategy but expected to improve as prices converge with competitors and volumes increase. - Dividend payouts are expected to be higher in FY ’25-’26, reflecting improved earnings and cash flows. - Capex planned at INR 500 crores for FY ’26, mainly focused on RMC plants and railway sidings, supporting incremental growth and operational efficiency.

The transcript does not explicitly mention the current or expected order book or pending orders for Shree Cement Limited. However, from the discussion, we can infer some points related to demand and capacity: - Demand is influenced by government infrastructure projects and budget cycles (e.g., Q3 saw increased non-trade/infrastructure demand due to government spending). - Capacity expansion plans are cautious and depend on demand visibility; current capacity at 72 million tons expected by March 2026, with possible expansion to 80 million tons by FY'29. - No concrete work on new capacities is ongoing as of the call, implying no immediate new orderbook additions. - The company is focusing on adding Ready Mix Concrete (RMC) plants (26 to 30 plants planned) to improve volumes. - They remain watchful of demand trends before finalizing major capex/orders. No direct numeric orderbook or pending order details were disclosed on this call.

- Shree Cement Limited is currently completely net debt free with around INR 6000 crores of free cash on the balance sheet. - The company is not worried about the quantum of capex needing to be spent due to strong cash position. - For FY 25-26, the planned capex is about INR 2000 crores (INR 1500 crores already spent, INR 500 crores to be spent in the last quarter). - For FY 26-27, capex guidance is approximately INR 500 crores, mainly towards setting up 26-30 Ready Mix Concrete (RMC) plants, railway sidings, and routine capex. - There is no firm plan yet for further cement capacity expansion beyond this. - No mention of any current or future fundraising through debt or equity was indicated in the call. The focus is on using internal cash resources for investments.

- FY '25-26 Capex: INR 2,000 crores (INR 1,500 crores spent, INR 500 crores planned in Q4). - FY '26-27 Capex guidance: INR 400-500 crores, including: - 26 to 30 Ready-Mix Concrete (RMC) plants (~INR 150-200 crores). - Railway sidings (INR 200-250 crores). - Routine maintenance capex (INR 50-100 crores). - No firm plan yet on further cement capacity addition beyond current targets. - Future expansions dependent on demand conditions; capacity target of 80 million tons by FY '29 may be deferred. - Kodla plant commissioning expected by March. - Company remains cash rich and debt-free, enabling flexibility for future investments. - Management will provide more clarity on major capacity additions in upcoming quarters.

- Industry growth expected to be around 7.5% to 8% in FY '26-'27, in line with India's GDP growth of about 7.4% (Page 7). - Shree Cement plans to maintain growth largely in line with the industry, with potential to outperform once price gap with competitors narrows further (Pages 6, 7, 13). - Q4 run-rate volumes expected around 9 to 9.5 million tons, with overall flattish year-on-year volume growth likely for the current year (Pages 12, 13). - The company adopted a value-over-volume strategy, sacrificing volumes initially to improve realizations and EBITDA per ton; volumes constrained purposely to improve pricing (Pages 11, 13, 16). - Capacity expansion plans aim to increase capacity to 80 million tons by FY '29 but no firm capex plans beyond limited INR 400-500 crore next financial year; further capacity additions depend on demand (Pages 13, 16). - RMC (Ready-Mix Concrete) business expanding from 19 to 45 plants by September 2026, expected to contribute to volume growth (Page 4).