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Displaying items by tag: Ambuja Cements
Sanjiv Waid appointed as State Head at Wonder Cement
24 July 2024India: Wonder Cement has appointed Sanjiv Waid as State Head. He previously worked as a Sales Marketing Manager for Ambuja Cements and has held roles with Nuvoco Vistas and ACC. He holds a bachelor’s in Industrial Chemistry from Delhi University.
India: Ambuja Cements and Ravi Sanghi plan to launch an offer for sale of a stake in Sanghi Industries. The Times of India newspaper has reported that Ambuja Cements will offer 2.4% of shares and Ravi Sanghi will offer 1.2%, giving a total offer of 3.6%. Following the completion of the intended sale, the companies’ combined stake in Sanghi Industries will drop to 75%, in line with shareholding rules for promoters.
Adani Group speeds up its expansion plans in India
19 June 2024Adani Group’s subsidiary Ambuja Cements signed a deal this week to buy Penna Cement for US$1.25bn. The agreement adds 14Mt/yr of cement production capacity to the group with a focus in the south of India. The acquisition is a big step towards the group’s target of reaching a capacity of 140Mt/yr by 2028. Ajay Kapur, the head of Ambuja Cements, also singled out the advantage the company hopes to gain from taking control of Penna Cement’s terminals saying that they would “prove to be a gamechanger by giving access to the eastern and southern parts of peninsular India.” The move is expected to increase the group’s market share in India by 2%, and by 8% in South India.
Penna Cement operates four integrated plants in Andhra Pradesh and Telangana with a capacity of 7Mt/yr. Two of these units also include waste heat recovery installations and one has a captive power plant. It runs two grinding plants in Andhra Pradesh and Maharashtra with a capacity of 3Mt/yr. Another integrated plant is being built at Jodhpur in Rajasthan and a grinding plant at Krishnapatnam in Andhra Pradesh. Finally, the company owns four bulk cement terminals at Kolkata, Gopalpur, Karaikal and Kochi in India, one at Colombo in Sri Lanka and it also owns a 25,000t cement carrier.
Adani Group’s march towards that target of 140Mt/yr by 2028 started off in mid-2022 when it purchased Ambuja Cements and ACC from Holcim. This gave it a starting capacity of 68Mt/yr in the cement sector. Various smaller additions followed including new plants at Ametha and Dahej and the acquisitions of Asian Cement and Concrete, MyHome Industries and Sanghi Industries. The latter company was the biggest of these purchases. Once the in-progress projects from Penna Cement are built, Adani Group should have a capacity of 93Mt/yr. Another 20Mt/yr is reportedly at various stages of execution. The remaining 27Mt/yr is described as being ‘blueprint ready.’
Generally, the local financial press has been in favour of the transaction agreeing with the geographic advantages of Adani Group increasing its presence in the southern states. The benefits of the high number of railway sidings at Penna Cement’s plants were also commented upon as a means for Ambuja Cements to reduce its costs per tonne of cement. The logistics benefit from the port terminals is also expected by Adani Group’s chief financial officer to reduce the group’s logistics costs with an impact expected within the next year. However, it has been reported that Penna Cement’s operating performance had been weaker in the last financial year due to low sales volumes, poor operational efficiency and high coal costs. A takeover by Adani Group could certainly fix the latter two issues. Yet, it has also been reported that competition in the cement markets in Andhra Pradesh and Telangana is up, due to a mismatch between supply and demand. So, improving Penna Cement’s capacity utilisation in these regions might be harder to solve than simply being absorbed into Adani Group.
India’s two largest cement producers both have plans in motion to mount up production capacity by the end of the decade in what has been dubbed ‘the battle of the billionaires.’ The market leader is UltraTech Cement and it has shown reluctance to cede ground to the cement newcomer Adani Group. The former company’s current target is to make it to just under 190Mt/yr by 2027. It said it had a capacity of 152Mt/yr in May 2024. It is ahead of Adani Group by this measure but there is still plenty of scope for surprises. Given the rivalry between the companies there is a regular stream of speculation about which of the smaller cement producers they might be about to buy at any given time. For example, in October 2023 HeidelbergCement India was rumoured to be courting offers from UltraTech Cement, Adani Group and JSW Cement. Last week, Adani Group was reportedly interested in buying either Saurashtra Cement, the cement business of Jaiprakash Associates, Vadraj Cement or… Penna Cement. Occasionally the rumours are true after all. UltraTech Cement remains in first place for now but the situation may change.
Ambuja Cement to acquire Penna Cement for US$1.2bn
14 June 2024India: Following the news of Adani’s multiple acquisition of cement companies, more details have come to light regarding the acquisition of Penna Cement. Adani-owned Ambuja Cement has signed an agreement to acquire Penna Cement Industries (PCIL) for US$1.2bn, aiming to reach a production capacity of 140Mt/yr by 2028. This acquisition adds 14Mt/yr to Adani Cement's total capacity, bringing it to 89Mt/yr, and expands Ambuja's market presence in southern India. The purchase will be fully funded through internal accruals.
Ambuja Cement CEO Ajay Kapur said "PCIL’s strategic location and sufficient limestone reserves provide an opportunity to increase cement capacity through debottlenecking and additional investment. Importantly, the bulk cement terminals will prove to be a game changer by giving access to the eastern and southern parts of peninsular India, apart from an entry to Sri Lanka, through the sea route."
India: Ambuja Cements has launched a new bulk cement vessel unloader at Karanja Port. This installation will facilitate swift movement of cement from the Sanghipuram plant to Mumbai.
The new unloader will increase the capacity utilisation of the Sanghipuram plant. This move is part of Ambuja Cements' strategy to optimise operational efficiency and reduce logistical challenges.
Ambuja Cements records growth in 2024
02 May 2024India: Ambuja Cements has reported a rise in revenue from operations from US$954m to US$1.07bn in the financial year ending 31 March 2024, representing a 12% year-on-year increase. Profit before tax grew by 22% to US$166m. The company recorded a loss of US$13.7m. Sales volume of cement and clinker increased by 18% year-on-year to 16.6Mt. Earnings before interest, depreciation and amortisation increased by 37% to US$203m.
India: Ambuja Cements has awarded a haulage contract to Orissa Bengal Carrier, Reuters has reported. Under the contract, Orissa Bengal Carrier will transport 180,000t of materials for the cement producer.
ACC raises sales in fourth quarter of 2024
26 April 2024India: Adani Group subsidiary ACC raised its sales by 13% year-on-year to US$649m in the fourth quarter of the 2024 financial year, Mint News has reported. The company’s operating earnings before interest, taxation, depreciation and amortisation (EBITDA) grew by 78% to US$100m, leading its profit to rise by a factor of three to US$89.8m. ACC sold 10.4Mt of cement, up by 22% year-on-year from 8.5Mt, and 660,000m3 of ready-mix concrete, down by 7% from 710,000m3. For the full 2024 financial year, the company produced 36.9Mt of cement and 2.68Mm3 of ready-mix concrete. Its sales were US$2.4bn, its earnings US$368m and its profit US$280m. This was the first full-year financial report for a year ending on 31 March, following ACC’s transition from reporting years ending on 31 December as part of Germany-based HeidelbergCement (now Heidelberg Materials).
CEO Ajay Kapur said “The trust of our customers and our commitment to building a sustainable future with investment in efficiency improvements, green power etc. has furthered our success as we emerge even stronger than before.”
Adani Group further raises Ambuja Cements stake to 70%
22 April 2024India: Adani Group has enlarged its stake in Ambuja Cements from 67% to 70%. The Telegraph newspaper has reported that the group converted warrants into shares in the producer. As a result, it will invest an additional US$1bn in funding for Ambuja Cements, having previously infused funding worth US$2.4bn.
Ambuja Cements director and CEO Ajay Kapur said “This infusion of funds provides Ambuja flexibility for fast-track growth, capital management initiatives and best-in-class balance sheet strength.”
Ambuja Cements to acquire grinding unit in Tamil Nadu
15 April 2024India: Ambuja Cements will acquire the grinding unit of My Home Group in Tuticorin, Tamil Nadu, for US$49.6m. The unit has a capacity of 1.5Mt/yr. The acquisition is spread across a 24.6-hectare site near Tuticorin Port and comes with a long-term fly ash agreement.
The CEO of Cement Business at Adani Group, Ajay Kapur said "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."
The total cement capacity of Adani Group now stands at 78.9Mt/yr.