UltraTech sees no major challenges in India Cements acquisition; closer to final approvals for Kesoram assets

UltraTech had announced the acquisition of the majority stake in India Cements in July

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26 Aug, 2025 12:21

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Cement giant UltraTech Cement Ltd "does not foresee" major challenges in completing the acquisition of a majority stake in India Cements Ltd, its chief financial officer Atul Daga told investors in a post-earnings call on Monday.
UltraTech, which is locked in a battle with Adani Cement-owned Ambuja Cements and ACC to increase market share in southern markets, had announced the India Cements acquisition in July 2024.
Daga said while UltraTech has received one set of queries about the acquisition from the Competition Commission of India (CCI), the queries are regular in nature, such as data about capacities of both the acquirer and India Cements across various markets, and whether the combined capacities amount to monopolies in some markets. He added that the approval and closure of the deal is a "matter of time", expected in the ongoing financial year, although that is contingent on approvals from the CCI and other regulators.
Asked about the potential spending on India Cements' facilities to bring it up to speed with the rest of the company, Daga said that those decisions will be made after approvals are received.
To strengthen its presence in the south, the Aditya Birla Group firm had also announced the acquisition of Kesoram Industries' cement assets, largely present in southern markets. Daga said that the company is in the "final stage" of receiving all approvals, with hearings at the National Company Law Tribunal pending. After the acquisition is complete, Daga said UltraTech will make a capital expenditure of around Rs 400-500 crore on Kesoram's cement facilities for efficiency improvements.

The sector outlook

Q2 FY25 was a damp quarter for the cement industry as a whole, with UltraTech reporting only a 3 percent volume growth on a year-on-year basis. Daga told investors that the quarter turned out "as expected" due to the intensity of the monsoon rains, which had reduced demand, and by extension, prices, across most markets. However, he said that one soft quarter is not a reason to pull back on capacity expansion projects, adding that cement is a "longer-term play". He said prices have also shown a slight upward trend, rising to Rs 354 per 50 kg bag of cement currently, from Rs 347 at the end of August.

Capacity expansion

Excluding acquisitions, UltraTech is aiming to reach a capacity of around 180 million tonne per annum by the second quarter of FY27. As for its acquisition strategy, Daga said that all inorganic expansions are "opportunistic" in nature, declining comment when asked about the mergers and acquisition pipeline.
Going ahead, Daga said that the company expects to better the industry in terms of volume growth in FY25. With road contract awarding resuming, albeit at a slower pace, the company expects the infrastructure segment, along with rural markets, to drive volume growth in the second half of the financial year.
On Monday, UltraTech's shares closed 2.1 percent lower on the National Stock Exchange at Rs 10,839.