## **Table of Contents** 1. [Q4FY26 Concall Overview and Cost Pressures](#anchor1) 2. [Cement Demand Recovery and Near-Term FY27 Outlook](#anchor2) 3. [Revenue Growth and Management Guidance](#anchor3) 4. [Expansion Plans: Vadraj and Panagrah Projects](#anchor4) 5. [Key Cost Factors and Operational Strategy](#anchor5) 6. [Q3FY26 Performance Context](#anchor6) --- <h2 id="anchor1">Q4FY26 Concall Overview and Cost Pressures</h2> [Nuvoco Vistas Ltd](isin#INE118D01016) conducted its Q4FY26 earnings concall addressing significant cost pressures and operational challenges faced during the quarter ended March 31, 2026. The concall focused extensively on the company's response to escalating fuel and packaging costs, with management outlining comprehensive cost mitigation strategies across its eastern and northern operations. The discussion centered on the implementation of strategic price increases across all markets and fuel mix optimization initiatives to counter inflationary pressures that impacted the cement manufacturing sector during the quarter. The Q4FY26 concall revealed the company's proactive approach to managing external cost pressures through operational adjustments and market-based pricing strategies. Management addressed the challenges posed by elevated pet coke prices, packaging cost escalations, and other input cost increases while detailing specific measures implemented across different geographical markets. The concall emphasized the company's strategic positioning across eastern markets, where it maintains over 70% of its sales, and outlined expansion timelines for upcoming capacity additions scheduled for completion by the end of FY27. The company reported Q4FY26 blended fuel costs of INR 1.44 per million calories compared to INR 1.43 in the previous period, indicating marginal sequential increase. However, the concall highlighted significant cost pressures from pet coke price escalations and packaging material costs, with granule prices increasing from INR 99 per kg in February to INR 155 per kg during the quarter, representing a substantial 56% increase within the quarter. ### **Operational Challenges and Market Response** The Q4FY26 concall addressed the impact of geopolitical factors on supply chains and input costs, with management acknowledging limited control over certain cost components while emphasizing proactive measures to mitigate their impact through operational efficiency and strategic sourcing initiatives. <h2 id="anchor2">Cement Demand Recovery and Near-Term FY27 Outlook</h2> The Q4FY26 concall indicated that cement demand recovery continued from the momentum established in Q3FY26, with management expressing moderate optimism about market conditions despite cost pressures. The company's eastern market dominance, representing over 70% of sales, positioned it to benefit from regional infrastructure spending and government capital expenditure programs. Management outlined expectations for continued demand improvement in FY27, supported by pending government projects and infrastructure development initiatives. The near-term outlook for FY27 reflects management's cautious optimism, with the concall emphasizing the company's defensive positioning through comprehensive cost mitigation measures and pricing strategies. The fuel cost forecast for Q1FY27 ranges between INR 110 crores to INR 155 crores, with Q2FY27 outlook indicating further increases from Q1 levels, requiring continued operational efficiency and pricing discipline. ### **Market Positioning and Demand Drivers** The concall highlighted the company's strategic advantage in eastern markets, where infrastructure spending and government projects provide sustained demand support. Management indicated that the company's geographic spread across East, North, and Western India provides flexibility in implementing market-specific strategies while maintaining competitive positioning. <h2 id="anchor3">Revenue Growth and Management Guidance</h2> The Q4FY26 concall addressed revenue growth challenges amid cost pressures, with management implementing comprehensive price increases across all operational markets. Eastern markets, including West Bengal, Chhattisgarh, and Orissa, witnessed trade channel price increases of INR 7-10 per bag for the full month, while non-trade channels experienced INR 12-18 per bag increases. Northern and western markets implemented trade channel increases of INR 8-10 blended, with non-trade channels seeing INR 10-15 increases. Management guidance for FY27 emphasized the continuation of cost mitigation strategies and pricing discipline to offset input cost pressures. The concall revealed management's moderate to cautious confidence level, with explicit acknowledgment that providing Q2FY27 cost outlook was premature given market volatility and external factors affecting input costs. ### **Pricing Strategy and Market Coverage** The company's comprehensive pricing strategy across all operational markets demonstrated management's proactive approach to maintaining margins amid cost inflation. Gujarat specifically experienced INR 15 increases in non-trade channels while other markets implemented INR 10 increases, reflecting market-specific pricing flexibility. | **Market Region** | **Trade Channel Increase (INR per bag)** | **Non-Trade Channel Increase (INR per bag)** | |-------------------|------------------------------------------|---------------------------------------------| | Eastern Markets | 7-10 | 12-18 | | Northern/Western | 8-10 | 10-15 | | Gujarat Specific | 8-10 | 15 | <h2 id="anchor4">Expansion Plans: Vadraj and Panagrah Projects</h2> The Q4FY26 concall provided updates on expansion projects, with the Jajpur plant requiring hardware modifications expected to complete within 2-3 months. The second plant is scheduled for completion by the end of the current year, with all operations targeted to be online by the end of FY27. Current status indicates the company is awaiting Consent to Operate approval for these facilities, with expansion plans remaining on track despite cost pressures. The Vadraj cement plant expansion strategy focuses on optimizing the company's geographical footprint and capacity utilization. Management outlined plans to serve western markets through Vadraj while redirecting capacity from other regions to optimize logistics costs and market penetration. The expansion timeline aligns with the company's strategic objectives of maintaining market leadership in eastern regions while expanding presence in western markets. ### **Panagrah Plant and Eastern Expansion** The Panagrah plant expansion forms part of the company's eastern region capacity enhancement strategy, supporting the company's dominant position in markets where it maintains over 70% of sales. The expansion projects are designed to support anticipated demand recovery while providing operational flexibility across different market segments. The concall emphasized that expansion projects remain adequately funded with inventory levels maintained at 6-8 weeks of pet coke stock to manage supply chain volatility during the expansion phase. <h2 id="anchor5">Key Cost Factors and Operational Strategy</h2> The Q4FY26 concall extensively addressed fuel cost dynamics, with blended fuel costs reaching INR 1.44 per million calories compared to INR 1.43 in the previous period. Pet coke costs increased significantly from INR 1.84 per million calories to elevated levels during the quarter, contributing to overall cost pressure. Management provided Q1FY27 fuel cost forecasts ranging between INR 110 crores to INR 155 crores. Packaging costs emerged as a major concern during Q4FY26, with granule prices escalating from INR 99 per kg in February to INR 155 per kg by quarter-end. ### **Fuel Mix Optimization Strategy** Eastern operations, comprising plants at Haras Mehta and Sonari, maintained pet coke usage at 23%, while the third eastern plant operated at 35% pet coke consumption. Management outlined plans to reduce these levels to below 20% and 30% respectively, representing a targeted reduction of 300-500 basis points from Q4FY26 consumption levels through increased use of Eastern coal and Juchak coal. Northern operations demonstrated higher pet coke dependency at 55-60% range during Q4FY26. The concall revealed management's strategy to reduce northern operations' pet coke consumption from 50% to 45%, targeting a reduction of 200-300 basis points through domestic coal contracts and potential lignite blending. | **Operations** | **Current Pet Coke Usage** | **Target Reduction** | **Cost Mitigation Strategy** | |----------------|----------------------------|---------------------|------------------------------| | Eastern (Haras Mehta/Sonari) | 23% | Below 20% | Eastern coal, Juchak coal | | Eastern (Third Plant) | 35% | Below 30% | Alternative sourcing | | Northern Operations | 55-60% | 45% | Domestic coal, lignite blending | <h2 id="anchor6">Q3FY26 Performance Context</h2> Q3FY26 provided the operational foundation for the strategic initiatives implemented during Q4FY26, with the company demonstrating resilience in managing cost pressures while maintaining production levels. The quarter had established the groundwork for fuel mix optimization strategies and alternative sourcing arrangements that were expanded during Q4FY26 to address escalating input costs. The company's Q3FY26 performance had shown its ability to navigate market volatility while maintaining operational efficiency across its eastern and northern facilities. This operational stability supported the comprehensive cost mitigation strategies outlined during the Q4FY26 concall, including the implementation of pricing increases and supply chain diversification efforts. ### **Strategic Foundation and Market Positioning** Q3FY26 had demonstrated the company's market positioning advantages, particularly its dominance in eastern markets, which provided the strategic flexibility utilized during Q4FY26 for implementing comprehensive price increases across all operational regions. The quarter's performance validated the company's operational capabilities across its 11 cement plants with combined capacity of 23.82 million tonnes per annum. The market positioning established during Q3FY26 supported the strategic initiatives outlined during the Q4FY26 concall, including capacity expansion projects and fuel mix optimization programs that aim to enhance operational efficiency and cost competitiveness across the company's geographical footprint while maintaining market share stability in key regions.