UltraTech Cement acquires Burnpur Cement's Jharkhand assets for ₹170 crore

UltraTech Cement acquires Burnpur Cement's Jharkhand assets for ₹170 crore
UltraTech Cement acquires Burnpur Cement's Jharkhand assets for ₹170 crore

by Tanushree Jaiswal Last Updated: Nov 30, 2023 - 01:33 pm 984 Views
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UltraTech Cement has acquired Burnpur Cement's grinding facility in Patratu, Jharkhand, enhancing its capacity to 133 MTPA in India. The 0.54 MTPA facility was secured for ₹169.79 crore, marking UltraTech's entry into the Jharkhand market. As a result, the company's shares rose by 1.01% in early trade. UltraTech Cement's acquisition not only adds substantial capacity but also positions the company strategically in the promising Jharkhand market. With a current total capacity of 133 MTPA, this move follows the company's October announcement of a ₹13,000 crore investment for further expansion.

Post the approval of the third phase of growth, UltraTech Cement is set to have a capacity of 132.45 MTPA of domestic grey cement. The company will have 35.5 MTPA capacity in the south, 40.4 MTPA in the east, 36.2 MTPA in the north, 35.7 MTPA in central, and 33.8 MTPA in the west. As per the reports, UltraTech Cement is exploring opportunities in Kesoram Industries' cement assets, indicating potential growth through existing promoter buyouts or business acquisitions. This aligns with UltraTech's continuous efforts to strengthen its position in the industry.

Global Standing

Currently, UltraTech Cement is the third-largest cement producer globally (excluding China) with a consolidated grey cement capacity of 137.85 MTPA. This reinforces the company's position as a major player in the international cement industry. In Q2, UltraTech's net profit surged by 68.8% YoY to ₹1,280 crore, driven by increased demand and higher government spending on infrastructure.

Market Performance

Over the year, UltraTech Cement's stock price has surged by 26.89%, outperforming the Nifty 50 index, which provided investors with a 10.4% return during the same period. This signifies strong investor confidence in the company's growth trajectory. UltraTech Cement continues its upward trend in the stock market, recording a  6% increase in the past month. Over a six-month period, investors have gained 13%, while the one-year return stands at 26%. Taking a broader view, the stock has delivered a 122% return over the last five years.

Final Words

With the latest acquisition and ongoing expansion plans, UltraTech Cement is poised for sustained growth, solidifying its position as a key player in the cement industry. The company's strategic moves align with the increasing demand for cement in India, driven by infrastructure development. UltraTech Cement's recent acquisition in Jharkhand, coupled with its expansion plans, showcases the company's commitment to meeting the growing demand for cement and strengthening its market position both domestically and globally.

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About the Author

Tanushree is a seasoned professional with 6 years of experience in the Fintech and Edtech industry.

Disclaimer

Investment/Trading in securities Market is subject to market risk, past performance is not a guarantee of future performance. The risk of loss in trading and investment in Securities markets including Equites and Derivatives can be substantial.
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