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Adani Group’s Ambuja Cement is buying 100% stake in Penna Cement Industries Limited (PCIL). After this news, Ambuja Cement is seeing a rise of more than 2% today. At 10:30 am, Ambuja Cement shares were trading at Rs 680 with a rise of 2.40%.
Ambuja Cement had informed about the acquisition of PCIL in its stock exchange filing yesterday i.e. on June 13. The company will spend Rs 10,422 crore to buy the entire stake of PCIL. Ambuja Cement had said that it would take 3 to 4 months to complete the acquisition of PCIL.
Jefferies gives ‘buy’ rating to Ambuja Cements stock
Jefferies has given ‘buy’ rating to the stock of Ambuja Cements, with a target price of Rs 735 per share. The brokerage said that this acquisition will strengthen the position of Adani Group’s cement company. Jefferies believes that with this deal Ambuja will increase its presence in the South.
This historic acquisition is an important step in the rapid growth journey of Ambuja Cement.
Ajay Kapoor, CEO and Whole Time Director, Ambuja Cement, said, ‘This historic acquisition is an important step in the rapid growth journey of Ambuja Cement.
By acquiring PCIL, Ambuja Cement wants to increase its market presence in South India. With this, the company is ready to strengthen its position as a pan-India leader in the cement industry.
Ambuja Cement said PCIL’s existing dealers will join Adani Cement’s market network to bring tremendous synergy.
PCIL has 14 MTPA cement capacity, out of which 10 MTPA is operational.
PCIL has 14 MTPA cement capacity, of which 10 MTPA is operational and the remaining is under construction at Krishnapatnam (2 MTPA) and Jodhpur (2 MTPA). The construction of both capacities will be completed within 6 to 12 months.
About 90% of the cement capacity comes from railway sidings and is supported by some captive power plants and waste heat recovery systems. Apart from this, the surplus clinker in the Jodhpur plant will support additional 3 MTPA cement grinding capacity in addition to 14 MTPA.
PCIL was established on 24 October 1991 in Hyderabad, Telangana.
PCIL was established on 24 October 1991 at Hyderabad, Telangana and is in the business of cement manufacturing. The company operates in India and Sri Lanka both directly and through its subsidiaries.
The consolidated turnover of PCIL was ₹1,241 crore in FY24, ₹2,002 crore in FY23 and ₹3,204 crore in FY22.
Ambuja Cement’s Q4 net profit rises 6% to ₹532 crore
Ambuja Cement had released the results of Q4FY24 i.e. the fourth quarter of financial year 2024 on May 1. In the January-March quarter, the company’s standalone net profit increased by 5.94% year-on-year to ₹532.29 crore. Last year, in the same quarter (Q4FY23), the company’s profit was ₹502.40 crore. Whereas, earlier in the third quarter the company had made a profit of Rs 513.68 crore. Ambuja Cement is India’s second largest cement manufacturer by market cap.
Ambuja Cement’s consolidated net profit increased by 64%
Ambuja Cement’s consolidated net profit in Q4FY23 rose 64% year-on-year to Rs 1,055 crore. There was a profit of Rs 645 crore in the same quarter of the last financial year. The company’s revenue (income) from operations during the fourth quarter stood at ₹8893.99 crore, which is 11.64% higher on an annual basis. Last year in Q4FY23 the company had an income of ₹7965.98 crore.
56.66% increase in profits in the entire financial year
The consolidated profit of the company has registered an increase of 56.66% in the entire financial year. The consolidated profit of the company in FY24 was Rs 4,738.01 crore. In the last financial year i.e. FY23, the profit of Ambuja Cement was Rs 3,024.38 crore.
Adani Group had purchased Ambuja Cement and ACC Cement in June 2022.
Adani Group had bought Ambuja Cement and ACC Cement for $10.5 billion in June 2022. Recently, Gautam Adani’s family has invested ₹8,339 crore in Ambuja Cement, increasing their stake in the cement manufacturing company to 70.3%. Ambuja Cement had given information about this in its exchange filing.
After the acquisition, Adani Family had invested ₹5,000 crore in Ambuja Cements through warrants exercisable on 18 October 2022. At the same time, 22 days ago i.e. on March 28, 2024, Adani family had invested ₹ 6,661 crore, when their stake in the company increased by 3.6% to 66.7%.
