Key Points
Exactly a month after it acquired a 23 per cent stake from DMart founder, Radhakishan Damani, UltraTech Cement, a part of the Aditya Birla Group and the largest player in the sector, announced that it would pick another 32.72 per cent stake in South-based India Cements at Rs 390 per share..
This will be followed by the mandatory 26 per cent open offer and if that is fully subscribed, UltraTech will hold 81 per cent in India Cements..
It will mark the exit of the India Cements promoter group led by N Srinivasan..
Of course, the move is also to pre-empt the Adani Group-owned Ambuja Cements, that has already picked up Sanghi, MyHomes grinding unit and Penna to acquire India Cements, a company with a capacity of 14.45 million tonnes per annum (mtpa), of which close to 13 mtpa is in the South (largely in Tamil Nadu) and 1.5 mtpa in Rajasthan...
A report by Emkay Global, put out right after UltraTechs announcement yesterday, gave a buy call for the company (the target price is Rs 12,800) and said, It is significantly strengthening its position, and we expect its capacity market share to more than double in the South, to around 25 per cent by FY27..
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