UltraTech Takes 8.69% Stake in Star Cement
UltraTech Cement Ltd has strategically acquired an 8.69% stake in Star Cement Ltd, purchasing shares worth Rs 8.51 billion from the company’s promoter group. The acquisition was completed via a block deal window, with UltraTech securing shares at Rs 235 per share, as disclosed in an exchange filing on December 27. This acquisition, however, remains a non-controlling minority stake for UltraTech.
Headquartered in Meghalaya, Star Cement has emerged as a key player in the northeastern cement market, commanding a 26.5% market share in the region. The company, which recorded a turnover of Rs 29.1 billion for the financial year 2024, boasts a grinding capacity of 7.7 million tonnes per annum (MTPA) and a clinker capacity of 6.1 MTPA. With an extensive distribution network comprising nearly 2,000 dealers and over 12,500 retailers, Star Cement is poised for further expansion. Notably, premium sales contribute to 10.6% of the company’s total sales. This acquisition forms part of UltraTech’s broader strategy to solidify its position within the Indian cement sector. Recently, UltraTech also increased its footprint by acquiring a controlling 32.72% stake in India Cements, which led to the company triggering an open offer at Rs 390 per share. With this move, India Cements is now a subsidiary of UltraTech, adding an additional 14.5 million tonnes to UltraTech’s overall production capacity.
Star Cement has been progressively expanding its resources and operations, notably emerging as the preferred bidder for six limestone blocks in Rajasthan’s Beawar district. The estimated geological reserves of these blocks stand at 63.9 million tonnes, spanning an area of 95.68 hectares. Furthermore, the company is in the process of establishing new plants in Assam’s Silchar and Jorhat districts, with a capital expenditure of Rs 3.80 billion planned for the second half of the financial year. Through this strategic investment, UltraTech not only strengthens its market position but also gains valuable exposure to Star Cement’s dominant presence in India’s northeastern region. The acquisition further bolsters UltraTech’s competitive edge, positioning the company for sustained growth in the years to come.
