Adani Group-owned Ambuja Cements to acquire My Home Group's 1.5 MTPA Tuticorin unit for ₹413.75 crore
Upstox
2 min read • Updated: April 16, 2024, 10:35 AM
Summary
Ambuja Cements said the acquisition will aid in enhancing the coastal footprint across southern markets of Tamil Nadu and Kerala. The asset spread across 61 acres of land, located near the Tuticorin Port with a long-term fly ash agreement will be value-accretive from the beginning, the company said.
Adani Group-owned Ambuja Cements has signed a definitive agreement to acquire My Home Group's 1.5 million tonnes per annum (MTPA) cement grinding unit in Tuticorin, Tamil Nadu at a total value of ₹413.75 crore through internal accruals. The acquisition will aid in enhancing the coastal footprint across southern markets of Tamil Nadu and Kerala, the company said in an exchange filing.
The total cement capacity of Adani Group stands at 78.9 MTPA. Ambuja Cements said the asset spread across 61 acres of land, located near the Tuticorin Port with a long-term fly ash agreement will be value-accretive from the beginning.
The company believes the limited availability of limestone in Tamil Nadu presents a unique competitive advantage with coastal movement of clinker from the Sanghipuram Plant ensuring cost-efficient operations.
Ajay Kapur, CEO – Cement Business at Adani Group said the acquisition strengthens the company’s foothold in the region. “In addition to the infrastructure and geographical advantages, Ambuja Cements will also inherit the existing dealer network and retain current employees, facilitating a smooth transition and enabling the rapid ramp-up of utilisation,” he said.
Recently, the Adani family infused ₹6,661 crore into Ambuja Cements. With this, the Adani family had increased their stake in the company by 3.6% to attain 66.7% holding.
During the third quarter, Ambuja Cements reported a 3% rise in its consolidated revenue from operations at ₹8,129 crore. Operating earnings before interest, tax, depreciation and amortisation (EBITDA) rose 70% to ₹1,732 crore during the quarter. Net profit rose over 123% to ₹1,090 crore.
The quarter also witnessed the company completing the acquisition of Sanghi Industries having 6.1 MTPA capacity. Ambuja’s subsidiary ACC completed the acquisition of the balance 55% stake in Asian Concretes and Cements having 2.8 MTPA capacity.
Shares of Ambuja Cements have risen over 13% since the beginning of the year. The stock has gained over 55% in the last one year.