UltraTech Cement recently announced its plans to invest ₹851 crore to acquire an 8.6% stake in Meghalaya-based Star Cement, which has a production capacity of 7.7 million tonnes per annum (MTPA) in East India.
In a regulatory filing, UltraTech revealed that promoter and promoter group entities of Star Cement had offered to sell their equity stake. UltraTech's board has approved the purchase of up to 37 million equity shares at a price not exceeding ₹235 per share, excluding taxes, resulting in a non-controlling minority stake.
With 150.7 MTPA capacity as of October 2024, UltraTech is India's largest cement manufacturer. Part of the Aditya Birla Group, the company aims to increase its total capacity to 200 MTPA by 2028.
Recent Acquisitions
This investment follows a series of strategic acquisitions by UltraTech. Earlier this month, the company finalized a ₹7,100 crore deal to acquire India Cements, making the South India-based cement maker its subsidiary. In November 2023, UltraTech took over Kesoram Industries' cement division for ₹7,600 crore. Together, these deals bring nearly 25 MTPA of additional capacity, which is yet to be included in UltraTech's current 150.7 MTPA total.
Expansion in Eastern India
Star Cement strengthens UltraTech’s foothold in East India, complementing its existing 30.7 MTPA capacity in the region. UltraTech plans to expand this to 41 MTPA by FY27, further solidifying its market presence.
Cement Industry in Consolidation Mode
The acquisition spree is part of a broader trend in the Indian cement sector. Over the past year, UltraTech and its closest competitor, Adani Group’s Ambuja Cements, have aggressively expanded their portfolios. Ambuja Cements has recently acquired South India-based Orient Cement and Penna Cement, as well as Gujarat-based Sanghi Industries.
With these moves, UltraTech and Ambuja continue to dominate India's cement landscape, leveraging acquisitions to drive growth and market consolidation.
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