Ultratech Cement’s announced an acquisition of a grinding unit from India Cements

UltraTech Cement Ltd, the cement flagship company of Aditya Birla Group, is a leading cement manufacturer in India, with a significant presence in the raw materials market. The company manufactures and sells a wide range of cement and cement-related products, catering to various construction needs across the country. The company has shown consistent growth and expansion in the past years with a high promoter holding of 59.96%. They have been involved with some big projects like the New Parliament building, Statue of Unity and Metro constructions across cities like Bengaluru and Mumbai. 

Grinding Unit Acquisition

In a stock exchange filing, UltraTech Cement Ltd., recently announced that they have entered into an Asset Purchase Agreement with India Cement Ltd and have received approval on the acquisition of a grinding unit from India Cements Ltd for Rs.315 Crores from the board. The company has further mentioned that the grinding unit which UltraTech Cement has acquired has an installed capacity of around 1.1 million metric tonnes per annum(MTPA), It also possesses a dedicated railway siding, located in Parli, Maharashtra and the unit has recorded a turnover of Rs.250.66 crore for the fiscal year ending March 31, 2023, with a net asset value of Rs.75.10 crore. They believe that this will help with expansion in the growing markets of Maharashtra. 

Expansion Plans

Moreover, UltraTech has plans on investing an additional Rs.504 Crores to expand the capacity of two of its units and to cater to the future growth of the company. Recently, they have also completed a 100-megawatt solar energy project to source power for its consumption in Rajasthan. In a separate filing, they refer to receiving approval for a previously suggested merger plan involving UltraTech Nathdwara Cement and its wholly-owned subsidiaries (Swiss Merchandise Infrastructure and Merit Plaza) with UltraTech Cement,  from the National Company Law Tribunal(NCLT). 

Conclusion: UltraTech’s strategic expansion plans and acquisitions have been a key driver of its dominance in the cement industry. With the help of its new acquisitions, it can access new markets and strengthen its distribution network. The infrastructure of the country is ever evolving and with the company’s positioning in the market, it seems all set to dominate and lead by increasing its market share.

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.