Nuvoco Vistas Corporation Limited hosted its Q2 FY27 earnings conference call on October 23, 2026. The discussion focused on the company’s financial performance, operational developments, and strategic growth initiatives. Key highlights included resilient performance amidst a challenging environment, capacity expansions, and efforts towards premiumization and cost optimization. The company also provided insights into upcoming projects and market outlook.
Nuvoco Vistas Q2 FY27 Earnings Conference Call Highlights
On October 23, 2026, Nuvoco Vistas Corporation Limited held its Q2 FY27 Earnings Conference Call. The management, including Jayakumar Krishnaswamy (Managing Director), Maneesh Agarwal (Chief Financial Officer), and Bishnu Sharma (Head of Investor Relations), provided an overview of the company’s performance and future outlook.
Operational Performance and Market Environment
Bishnu Sharma opened the call by highlighting the company’s decade-long journey and its evolution into a diversified building materials company. He noted that the quarter presented a challenging operating environment, influenced by escalating Middle East conflict leading to sharp increases in input prices like petcoke and coal. Domestically, erratic rainfall impacted coal inventories. Despite these macro challenges, Nuvoco Vistas reported a resilient performance with 9% volume growth year-on-year and approximately 14% revenue growth, accompanied by an 11% EBITDA growth.
The company’s strategic levers of premiumization and geo-mix were instrumental, with premiumization reaching a historic high of 45% and trade mix at 75%. Key operational developments included the commissioning of the 2 million tons grinding unit at Limla, Surat, enhancing manufacturing and distribution in Western India. Project activities at Kutch are progressing as planned, with phased operationalization expected from Q3 FY27. Additionally, an agreement for a 46.4-megawatt wind-solar hybrid renewable energy project in Rajasthan was executed.
Cost Management and Pricing Strategies
Discussions around costs revealed an increase in fuel cost from INR 1.52 per million kcal in Q1 to INR 1.59 in Q2, translating to an energy cost of INR 1,080 per ton. The company anticipates further increases in Q3 to INR 1.8 per million kcal, with an estimated increase of INR 70 to INR 80 in energy cost. Management highlighted efforts to secure petcoke coverage for Q3 and Q4 to mitigate price volatility. They also discussed strategic price increases implemented in September and October, averaging INR 20 per ton, expected to offset cost escalations.
Capacity Expansion and Future Outlook
Jayakumar Krishnaswamy provided updates on the Surat plant, which commenced commercial operations in September. The plant produced 3,500 tons in a single day, with a target of 2 million tons annualized volume in Gujarat by Q4 FY27. The company anticipates total capacity utilization reaching 70-75% next year. Capex spending for the year is projected at INR 1,200 crore, with a significant portion allocated to rebuilding Vadraj Cement facilities.
The East expansion project has been slightly delayed to Q1/Q2 FY28 to prioritize the Vadraj project. For FY28, capex is estimated between INR 800 crore to INR 900 crore. The net debt has increased to approximately INR 5,000 crore, largely due to petcoke stocking and higher capex spend. However, the company expects working capital release and increased cash flows in H2 to bring the net debt back to March last year’s levels. The long-term strategy aims to maintain net debt between 2x to 2.5x EBITDA, with an aspiration to bring it below 2x once Vadraj volumes are fully absorbed.
Regional Demand and Outlook
Regarding regional demand, the company anticipates an industry growth of 7% to 8% in H2, driven by infrastructure spending and the post-monsoon construction season. While East experienced some sluggishness due to erratic monsoons, North showed robust volume growth. The company remains optimistic about the overall industry outlook, forecasting blended growth of 8% for India in H2.
Vadraj Assets and EBITDA
On Vadraj assets, the company projects EBITDA per ton to match Nuvoco’s blended EBITDA by year 3 of operations (FY28), assuming a steady state where cost inflation is absorbed by price increases. The company aims to leverage its integrated position in Gujarat, including the bulk terminal and grinding units, to achieve competitive costs.
Interest Expenses and Tax Regime
Maneesh Agrawal clarified that the reduction in interest expense in Q2 was primarily due to the capitalization of borrowing costs for the Surat plant, which commenced operations late in September. This impact is specific to the quarter, and interest expense and depreciation will be visible in the P&L going forward. Regarding tax, the company is evaluating the transition from the old to the new regime and will finalize its decision by the end of the financial year. The current tax rate of 41% is higher due to the old regime and the unavailability of MAT credit under the new Income Tax Act.
Data Points and Conclusion
Key data points shared include a road and rail share of 64:36, a lead distance increase to 332 km, and blended fuel costs of 1.59 in Q2 with coal at 66% and petcoke at 27%. The blended cement share is approximately 83%. The company also reported its brands, Duraguard Microfiber and Concreto Uno, reaching 1-million-ton brand status. Bishnu Sharma concluded by reiterating the company’s focus on premiumization, geo-optimization, and operational excellence, remaining confident in its resilience and strategic initiatives.
Source: BSE
