ITD Cementation Shares Tumbled Over 7%: Promoters to Sell 46.64% Stake

On October 28, 2024, ITD Cementation shares fell 7.7% during early trading, reaching a low of ₹491.55 on the BSE by 10:15 AM. This decline follows the Adani Group’s recent acquisition of a stake in Orient Cement, as Renew Exim DMCC, a Dubai-based firm under the Adani umbrella, announced an agreement to acquire a 46.64% stake in ITD Cementation India from its promoters for ₹3,204 crore.

As part of this transaction, priced at ₹400 per share, the current promoter, Italian-Thai Development Public Company, will exit its role, with Renew Exim DMCC becoming the new promoter, pending regulatory approvals. Additionally, the Adani Group will launch an open offer to acquire an additional 26% stake at ₹571.68 per share, compared to ITD Cementation’s closing price of ₹532 on Friday. If fully subscribed, the open offer will cost ₹2,553 crore.

On October 22, Ambuja Cements, also part of the Adani Group, announced its third acquisition in a year, agreeing to purchase a 46.8% stake in C K Birla-owned Orient Cement for an equity value of ₹8,100 crore. Earlier, Ambuja had acquired a majority stake in Sanghi Cement in December and Penna Cement in August 2023, having made a high-profile entry into the cement industry by acquiring Ambuja Cement and its subsidiary ACC for $6.5 billion in 2022.

ITD Cementation India, operating in India for nearly nine decades, specializes in heavy civil engineering, infrastructure, and EPC projects. The company has established expertise in maritime structures, mass rapid transit systems, airports, hydroelectric power, tunnels, dams, irrigation, highways, bridges, flyovers, and industrial buildings. For the fiscal year 2024, it reported revenues of ₹7,542 crore and a profit of ₹274 crore.

In the broader context, Ultratech Cement plans to increase its capacity from 150 million tonnes per annum (mtpa) to 200 mtpa by 2027, while Ambuja also aims to raise its capacity to 150 mtpa during the same period.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.