Ambuja Cements, a key player in the Indian cement industry and part of the Adani Group, has announced its plans to merge two subsidiaries—Sanghi Industries (SIL) and Penna Cement Industries (PCIL)—with itself in a strategic move aimed at consolidating operations and enhancing growth. The merger proposal outlines that Ambuja Cements will issue 12 equity shares of face value Rs 2 each for every 100 shares of Sanghi Industries, whose shares have a face value of Rs 10 each.
The merger plans, which are set to be completed within 9 to 12 months, are subject to approvals from the relevant stakeholders and authorities. Once finalized, the eligible shareholders of Sanghi Industries will become shareholders of Ambuja Cements. Similarly, Penna Cement, which operates four integrated plants in Andhra Pradesh and Telangana, along with a grinding unit in Maharashtra, will also merge with Ambuja Cements, strengthening its footprint in the cement sector.
Ajay Kapur, CEO of the Cement Business at Adani Group, emphasized that this merger would help Ambuja Cements streamline its working capital management, simplify governance, and reduce administrative costs. The unified operations would pool resources for faster expansion and improved cost savings, enabling Ambuja Cements to grow more efficiently. Sanghi Industries, with its large clinker capacity of 6.6 MTPA and cement capacity of 6.1 MTPA, is a significant player in the cement market. Its flagship Sanghipuram plant, located in Gujarat, is India’s largest single-location cement and clinker unit, equipped with a captive jetty and power plant. Penna Cement, with an operational capacity of 10 MTPA, operates in multiple locations across India, including plants in Andhra Pradesh, Telangana, and Maharashtra. Additionally, Penna Cement is expanding further with two new plants under construction, projected to add another 4 MTPA to its capacity. This strategic consolidation is set to enhance Ambuja Cements’ market position, helping the company better manage its cash flow and align its operations for future growth. As the cement industry continues to expand in India, the merger will allow Ambuja Cements to offer more competitive products, simplify compliance, and further solidify its leadership in the industry.
