📷 Image Credits: Forbes
Indian billionaire Gautam Adani’s Ambuja Cement, backed by the Adani Group, has agreed to acquire Penna Cement Industries for a staggering $1.2 billion, reflecting the group’s strategic move to capitalize on the construction boom in India. The acquisition, valued at 104.2 billion rupees, will significantly enhance Ambuja’s production capacity, positioning it as a formidable player in the cement industry.
The landmark deal marks a milestone in Ambuja Cement’s growth trajectory, as highlighted by CEO Ajay Kapur, who expressed confidence in the company’s expanding market presence in south India and its emerging dominance as a pan-India leader in cement. The acquisition will bolster Ambuja’s annual cement production capacity by an impressive 14 million tonnes, inching closer towards its ambitious goal of achieving 140 million tonnes by 2028. This move will place Ambuja in close competition with Ultratech Cement, India’s largest cement manufacturer, which currently produces almost 153 million tonnes annually.
Ambuja has tactically recognized Penna’s strategic advantages, including its favorable location and abundant limestone reserves, which will play a crucial role in supporting the group’s future expansion endeavors. Additionally, Penna’s forthcoming plans to construct two additional plants are poised to increase its current output by a significant 4 million tonnes within the next 12 months. Furthermore, Ambuja will gain access to Penna’s bulk cement terminals, enabling it to extend its reach within eastern and southern India, as well as opening up pathways to Sri Lanka through sea routes.
The Adani Group’s aggressive investments in the cement sector coincide with Prime Minister Narendra Modi’s ambitious infrastructure modernization and housing development agenda for India. A notable entrant in the cement industry since 2022, the Adani Group’s acquisition of Ambuja and ACC for $10.5 billion from Holcim marked a pivotal moment in its expansion strategy. Last year, the group further strengthened its presence by acquiring Sanghi Industries for $202 million. With a substantial net worth of $68 billion, Gautam Adani is positioned as the second wealthiest individual in India, underscoring the diversified nature of the Adani Group’s business empire encompassing airports, mining, ports, and power generation.
