The company has conducted a conference call on 30 October 2018 to discuss the financial performance for the second quarter ended September 2018 and way forward. Mr.S. Sreekanth Reddy, Executive Director; Mr. K Prasad, Chief Financial Officer; and Mr. P.S. Prasad, President – Marketing of the Company addressed the conference call.

Key highlights

• The Company performed well in the first half of the year (H1FY19), as demonstrated by the steady growth in volumes and revenues. The growth was largely attributed to diversified presence and product mix and recent strategic measures initiated towards lowering the expenses and improving efficiencies.

• The Company grinding unit at Gudipadu (BMM unit in Andhra Pradesh) was closed for maintenance for nearly 50 days against the scheduled 40 days which impacted its capacity utilisation and the performance in Q2FY19.

• The Company has undergone various cost saving measures (replacement of coolers & kiln upgradation) and as a result, company's cement capacity has catapulted to 5.75mt against 4.3mt previously while current clinker capacity stands at 3.8mt.

• The Company Raw Material Cost increased ~5% yoy during Q2FY19, mainly due to higher intake of slag in Vizag Grinding Unit (Post Commissioning). Going forward, Company expects the cost to stabilise.

• The Company landing cost of petcoke stood at ~US$120/mt and domestic pet coke ~ Rs 9,000/mt during Q2FY19. Given the backdrop of falling pet coke price, company expects the major benefit to start accruing from Q4FY19 onwards.

• The Company overall capacity utilisation stood at 52% against 62% in Q2FY18. Capacity utilisation for Bayyavaram plant stood at 23% against 57% in Q2FY18 while Gudipadu plant operated at 56% utilization against 63% in Q2FY18.

• The Company expects to incur Rs 70 crore (Rs 55 crore for CPP and Rs 15 crore for maintenance shutdown) in H2FY19. However, there will only be maintenance capex from FY20 onwards.