Ambuja Cements has revealed its plan to acquire a 45.7% stake in Orient Cement Limited (OCL) in a deal worth approximately ₹8,100 crore. The transaction is priced at ₹395.40 per share and will trigger an open offer for an additional 26% of shares from public shareholders. The acquisition will be fully funded through internal accruals.

The shares were trading 1.11% higher at ₹578.25 on NSE

This strategic move will add 8.5 MTPA to Ambuja’s operational capacity, bringing its total to 97.4 MTPA. By the end of FY25, Ambuja aims to surpass 100 MTPA and plans to reach 140 MTPA by FY28. The acquisition strengthens Ambuja’s foothold in the South and West Indian markets, increasing its market share in India by 2%.

OCL’s assets include 8.1 MTPA of ready-to-execute projects and high-quality limestone reserves in Chittorgarh, Rajasthan, presenting growth opportunities in Northern India. The integration of OCL is expected to optimize logistics costs, improve capacity utilization, and provide significant cost savings through streamlined operations.

Ambuja targets 85% capacity utilization in the next three years, an EBITDA of ₹1,500 per tonne by FY28, and a return on capital employed (ROCE) exceeding 15%. This acquisition aligns with Ambuja’s strategy to solidify its cost leadership in the cement industry while preparing for further growth in the Indian market.

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TOPICS: Ambuja Cement