📷 Image Credits: Mint
Adani Group’s firm, Ambuja Cements, made a significant move on Thursday, June 13, by acquiring Penna Cement Industries Ltd (PCIL) in a deal worth ₹10,422 crore. This acquisition marks a major milestone for Ambuja Cements, adding 14 MTPA capacity, and bringing the total tally to 89 MTPA.
The acquisition is set to enhance Adani group’s presence in the cement market across India, with a 2% increase in market share pan-India and an impressive 8% rise specifically in south India, as per regulatory filings by Ambuja Cements.
Ambuja Cements will acquire the 100% shares of PCIL from its existing promoter group, P Pratap Reddy and family. PCIL, with a capacity of 14 MTPA in Andhra Pradesh, Telangana, and Rajasthan, is undergoing construction. The acquisition will be fully funded through internal accruals.
Ajay Kapur, the CEO & Whole Time Director of Ambuja Cement, highlighted the strategic advantages of the acquisition, stating that it will expand the market presence in south India and solidify the company’s position as a dominant player in the industry. The deal is poised to leverage PCIL’s strategic location and significant limestone reserves to boost capacity through debottlenecking and additional investments.
Furthermore, the acquisition includes surplus clinker at the Jodhpur plant, supporting an additional 3 MTPA cement grinding capacity. The deal will also bolster Adani Group’s sea transportation logistics with five bulk cement terminals at key locations like Kolkata, Gopalpur, Karaikal, Kochi, and Colombo to serve peninsular India.
Earlier this year, the Adani family made a significant investment of ₹8,339 crore in Ambuja Cements Ltd, further solidifying their commitment to the cement sector. Following the acquisition news, shares of Ambuja Cements experienced a slight dip, settling at ₹664.30 apiece post a new 52-week high mark of ₹680.20 on the BSE.
This acquisition marks a strategic move by the Adani Group through Ambuja Cements, propelling the company’s growth trajectory and cementing its place as a formidable player in the Indian cement market.
