Kochi two prominent cement manufacturers, JK Lakshmi Cement and Chettinad Cement, are reportedly bidding to acquire Telangana-based Deccan Cements. This move comes as a state-driven infrastructure boom in neighboring Andhra Pradesh fuels significant demand for regional suppliers of cement, a freight-heavy building material. Deccan Cements, which anticipates an operational capacity of 4 million tonnes by the end of this year, is seeking an enterprise value of $360 million (₹3,110 crore) for the company, translating to approximately $90 per tonne of capacity, attracting keen interest from major players in the consolidated Indian cement sector.
Deccan Cements’ plants are strategically located on the outskirts of Vijayawada, Andhra Pradesh’s second-largest city, although its corporate headquarters are in Hyderabad. The company is currently spearheaded by a female leader. Reports suggest that Deccan Cements has engaged EY for a potential sale, indicating a structured process for the acquisition. The ongoing infrastructure boom is particularly driven by the development of Andhra Pradesh’s new capital city, Amaravati, for which the Centre has unveiled projects worth ₹50,000 crore, ensuring sustained high demand for construction materials in the region.
Replacement valuations in India’s regionally segmented cement industry show wide variations, with greenfield expansions often exceeding $100 per tonne. However, valuations in southern India tend to be more reasonable due to lower capacity utilization and naked cement realization (NCR) on each tonne sold. While Delhi-based JK Lakshmi Cement currently lacks a manufacturing presence in Andhra Pradesh or Telangana, Chennai-based Chettinad Cement already boasts manufacturing facilities in both states, giving it a potential strategic advantage in the bidding process.
Shares of Deccan Cements have seen a significant surge in 2025, climbing by nearly 66% and hitting a lifetime high of ₹1,125 earlier this month. Despite this stock performance, the company has experienced a steady decline in profits since 2021, with its full-year profit for fiscal year 2025 standing at a mere ₹8 crore on sales of ₹527 crore. Its earnings before interest, tax, depreciation, and amortisation (EBITDA) per tonne of cement produced was ₹489 in fiscal year 2023-24, significantly lower than the industry average EBITDA of ₹900-1200 per tonne, with industry watchers noting the scale benefits enjoyed by larger players.
India’s cement sector has witnessed robust consolidation since fiscal 2023, predominantly in the southern markets, which account for almost one-third of the country’s total production. This heightened demand and ongoing consolidation signal an active acquisition landscape.
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Chettinad Cement and JK Lakshmi in Race to Acquire Deccan Cements
