Adani family infuse ₹6,661 crore in Ambuja Cements, raises stake to 66.7%

Adani Family has infused ₹6,661 crore in Ambuja Cements, raising the family’s equity stake to 66.7% in the company. Adani Family, a promoter of Ambuja Cements, had in October 2022 infused ₹5000 crore in the cement manufacturer for exercising the issuance of the warrants approved by Ambuja’s board.

This takes the total infused amount to ₹11,661 crore, setting up Ambuja Cements with capital flexibility for accelerated growth and capital management initiatives, the company revealed in a regulatory filing.

Following the announcement, Ambuja Cements shares closed 1.91% higher on Thursday, with a day high of ₹617 apiece on NSE. In the December quarter of 2023, the company reported revenue of ₹4,439.52 as compared to ₹4,128.52 reported a year ago.

According to the exchange filing, this fund infusion will help boost Ambuja Cements' financial position and achieve its ambitious growth plans, including doubling its capacity to 140 million tonnes per annum by 2028 from the cement vertical.

Furthermore, the company plans to improve bottlenecks in capital expenditures and undertake strategic initiatives, including bringing efficiencies across its resources and supply chain. Besides this, market experts believe the company will also benefit from India's infrastructure boom. Adani purchased a controlling stake in Ambuja Cements and ACC Ltd from Switzerland-based Holcim for about ₹51,200 crore in 2022.

Ajay Kapur, Whole Time Director and CEO, of Ambuja Cements Ltd commented that “infusion of funds provides Ambuja capital flexibility for fast-tracked growth, capital management initiatives, and best-in-class balance sheet strength”

Barclays Bank PLC, MUFG Bank, and Standard Chartered Bank acted as advisors in the deal.