HeidelbergCement India : Transcript of Analysts/Institutional Investor Meet/Con. Call

HEIDELBERGCEMENT

HeidelbergCement India Limited

	ON: L26942HR1958FLC042901
	Registered Office
	2nd Floor, Plot No. 68, Sector-44,
	Gurugram, Haryana 122002, India
	Phone [phone]
	Fax [phone]
HCIL: SECTL:SE:2022-23	Website:www.mycemco.com
20 July 2022
BSE Ltd.	National Stock Exchange of India Ltd
Listing Department	Listing Department,
Phiroze Jeejeebhoy Towers	Exchange Plaza, C/1, Block G,
Dalal Street, Fort,	Sandra Kurla Complex, Sandra (E)
Mumbai - 400001	Mumbai - 400 051
Scrip Code:500292	Trading Symbol: Heidelberg
Dear Sir,

Sub: Transcript of Earnings Call - Regulation 30(6)

This has reference to our letter dated 15 July 2022 informing about conference call being organised by PhillipCapital (India) Pvt. Ltd. Further to our aforesaid letter please find attached transcript of earnings call with analysts and investors held on 19 July 2022 on Unaudited Financial Results of the Company for the quarter ended 30 June 2022.

The above information is also available on the website of the Company at https://www.mycemco.com/financial-results

Please take the same on record.

Thanking you,

Yours faithfully,

For HeidelbergCement India Ltd.

Rajesh�

Legal Head & Company Secretary

Encl.: a.a

■ -�• ■ •

MATERIAL

TO BUILD OUR FUTURE:

"HeidelbergCement India Limited Q1FY'23 Earnings

Conference Call"

July 19, 2022

MANAGEMENT: MR. JAMSHED NAVAL COOPER - MANAGING

DIRECTOR, HEIDELBERGCEMENT INDIA LIMITED.

MR. ANIL SHARMA - CHIEF FINANCIAL OFFICER,

HEIDELBERGCEMENT INDIA LIMITED.

MODERATOR MR. VAIBHAV AGARWAL - PHILLIPCAPITAL (INDIA)

PRIVATE LIMITED.

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	HeidelbergCement India Limited
	July 19, 2022
Moderator:	Ladies and gentlemen, good day and welcome to the HeidelbergCement India Limited Q1 FY'23
	Earnings Conference Call hosted by PhillipCapital (India) Private Limited.
	As a reminder, all participant lines will be in the listen-only mode and there will be an
	opportunity for you to ask questions after the presentation concludes. Should you need assistance
	during the conference call, please signal an operator by pressing '*' then '0' on your touchtone
	phone. Please note that this conference is being recorded.
	I now hand the conference over to Mr. Vaibhav Agarwal from PhillipCapital (India) Private
	Limited. Thank you, and over to you sir.
Vaibhav Agarwal:	Good afternoon everyone. On behalf of PhillipCapital (India) Private Limited, we welcome you
	to the Q1FY23 Call of HeidelbergCement India Limited.
	On the call we have with us Mr. Jamshed Naval Cooper - Managing Director and Mr. Anil
	Sharma - Chief Financial Officer of HeidelbergCement India Limited.
	I would like to mention on behalf of HeidelbergCement India Limited and its Management that
	certain statements that may be made or discussed on this conference call may be forward-looking
	statements related to future developments and the current performance. These statements may
	be subject to a number of risks, uncertainties, and other important factors, which may cause the
	actual developments and results to differ materially from the statements made.
	HeidelbergCement India Limited and the Management of the company assumes no obligation
	to update or alter these forward-looking statements, whether as a result of new information or
	future events or otherwise.
	Also, HeidelbergCement India Limited has uploaded a copy of the Q1FY23 Presentation on the
	stock exchanges and its website. Participants are requested to download a copy of the
	presentation from these websites.
	I will now hand over the floor to the management of HeidelbergCement India Limited for their
	opening remarks, followed by an interactive Q&A. Thank you and over to you, Cooper sir.
Management:	Thank you everyone who has joined this conference call today. While you would have
	downloaded our presentation, I will start this by saying that it was the one of the tough quarters
	for the industry. I am sure for others also it would be. For us it has been mainly because I would
	say that camp was played here by cost. So, it has been a very costly quarter, I would say.
	However, nevertheless, let me run through the presentation, some of the key points in the
	presentation which are there with you. So, the capacity utilization, as usual we try to keep it at
	on a very high level. So, we operate at close to about 72% capacity utilization, which is, I would
	say it is under such a difficult quarter operating at this level was a good task done by the team.
	As a Company we operate 100% blended so, on a carbon footprint, on a sustainability we are on
	a very high note. We are close to about 511 kgs per tonne of cement. Last time also we said that
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HeidelbergCement India Limited

July 19, 2022

we are sourcing renewable power in our journey to have more and more power under renewable, and the green power. We got this 15 megawatts, clicking-in,ticking-in from March, and now at Jhansi plant we are having this power availability.

Very happy to inform you that for the first time highest ever share of green power in this Company has been 30% which is a, I would say is a very welcome move of the Company towards the direction which leads this Company, it puts it ahead on the curve.

We have again migrated, last time also we mentioned that we are migrating to a lower corporate tax and now it is lower tax from this year and this has been accounted for while we are making our planning and while we are doing our results.

Net cash in banks is close to about Rs. 2.2 billion. So, we have a good reserve here. And we continue to operate on negative working capital which has always been one of our USP in the market. And despite a very strong push back on the liquidity side, the team has been able to try to collect the monies on time, although there is a little bit of debtors increase but sometimes it happens in certain week, months but yes overall I would say it's good progress from the management side of the team has done a relatively good job.

Moving to Slide #4, which is on the Page #4, as I mentioned blended we are 100%, CO2 we are 511 kgs per tonne, and another bright spot the silver lining here is that we have water positivity of 4.4, we are working to improve it further and possibly, if this year the monsoons are good, we will be able to harvest far more water and improve this trajectory from 4.4 and upwards.

On the CSR side, we have been responsible or we should say that we have been able to be a change agent for the lives of about 32,000 people. And the journey goes on, and we keep contributing, because we believe that industries cannot survive or exist in societies that fail.

On the green power side, I mentioned to you, which is the highest ever we did 30% share of green power.

Moving to Slide #5, this is the snapshot of how our, this 30% contribution is distributed. So, it is in Jhansi it's 15 megawatt. In Narsinghgarh with the help of 12 megawatt WHR and 5.5- megawatt solar plant, we are able to get a good respite on terms of power from the grid, our grid content has reduced. Same thing in Ammasandra it has been now a story for more than two years, two and a half, three years, where we have been operating close to 90% of our power is green power.

On the right-hand side, you can see how our growth trajectory has been. And one good point is that this quarter, we have achieved 30%.

Coming to the results, which are on Page #6, whatever we did, okay, we tried to improve our pricing power. We did every possible thing to improve our revenue on the revenue side, but on the cost side, the fuel and power this has impacted us inversely. And our total cost has gone up

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HeidelbergCement India Limited

July 19, 2022

by 24%. And on the side of realization, we have been able to takeout about 13% out of it. So, still there is a lot of road to catch up. It is unfortunate that the markets have remained soft, for reasons best known to the market. There was a good demand some period, but in the month of May, it has been a very bad month. In the month of June, it has improved. July seems to be a little better, but now let's see how the monsoons pan out.

Giving you quarter fall how our EBITDA has got impacted or how the quarter fall has happened. So, you can see that, our EBITDA per tonne was about 1100 last June. We got added on price and you can see on the right-hand side and the middle of it, which is a center of drawing attention, which is about Rs. 620, was taken away totally by power and fuel.

This other items, you can see a little bit here. But then these are some of them, I would say they are not critical ones, they are one off ones so that is not a major concern for us because there was some shutdown and some small things happen. So, that's not too much of a concern for us. That will come back to normal. But this power and fuel will remain our question of concern for us and I am sure it will for the other industry members also.

On Page #8, you can see that we are on a net cash of Rs. 2.2 billion as of now after the debt is being paid, it will be taking its own time, which will be paid up on the right-hand side, the breakup has been given how the cash flow is going to go out from 23 to 26. And how it is going to be repaid. But today as of now the bank balance is about Rs. 4.58 billion, which is a good balance which we are sitting on.

Coming on Slide #9, you can see that our volumes are about 45%. And coal this time you will see a little change in the coal because till February, the coal prices were lower than petcoke. And now petcoke prices are lower than coal, so we had to rechange, rejig the whole fuel mix. And now we have come back to on coal, coal is 38% and petcoke is more.

Coming to our premium cements:

Happy to say that there is a 6% growth on year-on-year which is very much in-line with the trajectory we have planned. And we want to continue growing till we reach a reasonable amount. As of now, it is about 23% of our trade is premium brands. 83% of our volumes have been in trade and balance is in non-trade.Non-trade and trade, I will be very happy to inform you that earlier the difference between trade and non-trade was more. We have been able to narrow the gap, so to that extent there is some merit in selling a little bit of non-trade little more.

Another thing which I want to inform you, which you might have heard or you might have not heard which is on Page 10. This is a very unique initiative, which we have launched by probably the first time in the cement industry, anywhere in the globe. This project we took up because to address the dilemmas of the cement consumers.

Let me, for those people who are not aware of it, elaborate a little. Normally in Indian cement industry or later consumer, where the cement team goes to buy a cement, first of all, when a

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