NEW DELHI:
UltraTech Cement
, India’s leading cement producer and a flagship company of the
Aditya Birla Group
, has announced a Rs 3,954 crore deal to acquire a controlling
stake
in
India Cements
. This strategic move is set to bolster UltraTech’s presence in the highly competitive
southern states
of India, particularly Tamil Nadu.
The board of UltraTech Cement approved the
acquisition
of a 32.72% stake in India Cements from its promoters and their associates at a price of 390 rupees per share, amounting to Rs 39.54 billion ($472.38 million).
This purchase is in addition to the 23% stake UltraTech acquired in June. Following this transaction, UltraTech’s total stake in India Cements will exceed 55%, necessitating an open offer to buy additional shares from public shareholders at the same price, as per regulatory requirements.
The acquisition is part of UltraTech’s broader strategy to dominate the Indian
cement market
, which is projected to nearly double in value to $49 billion by 2029, driven by significant infrastructure investments under Prime Minister Narendra Modi’s government.
“This deal will help UltraTech Cement meet its production target of 183.5 million metric tons by the fiscal year ending March 2027,” said Ashutosh Murarka, a research analyst at Mumbai-based Choice Broking. “We expect the deal momentum in India’s south to continue,” he added.
UltraTech’s acquisition includes 28.42% from promoters Srinivasan N, Chitra Srinivasan, Rupa Gurunath, and SK Asokh Baalaje, along with 4.30% from Sri Saradha Logistics. The total deal, once completed and regulatory approvals obtained, will significantly expand UltraTech’s footprint in southern India.
The acquisition follows UltraTech’s Rs 1,900 crore purchase of a 23% stake in India Cements in June. The latest move aims to leverage operational efficiencies by acquiring ready-to-use assets, reducing the time to market compared to greenfield projects.
Kumar Mangalam Birla
, Chairman of the Aditya Birla Group, expressed excitement about the acquisition, highlighting its potential to enhance UltraTech’s service to southern markets and accelerate the company’s growth towards a 200 million tonnes per annum (MTPA) capacity.
“The India Cements opportunity is an exciting one, as it enables UltraTech to serve the Southern markets more effectively and accelerates the path to over 200 MTPA capacity,” said Birla. “These investments have also facilitated India’s nationwide infrastructure upgrade, powering our country’s growing need for housing, roads, and other vital infrastructure.”
With this acquisition, UltraTech solidifies its leadership in the Indian cement industry, where it already boasts an installed capacity of 154.86 MTPA of grey cement. UltraTech’s strategic investments, both organic and inorganic, continue to propel India toward becoming a global building solutions champion.
Meanwhile, the Adani Group, another major player in the Indian cement industry, is also on an expansion spree. The group recently announced the acquisition of Penna Cement for Rs 10,422 crore, adding 14 MTPA to its capacity, aiming for a total of 140 MTPA by FY28.
UltraTech’s acquisition of India Cements is expected to be completed within six months, pending necessary regulatory approvals. This move marks a significant step in UltraTech’s ongoing efforts to expand its market share and operational capabilities in India’s rapidly growing cement industry.
(With inputs from agencies)
