UltraTech eyes Orient Cement acquisition amid sector consolidation

4 Jul 2024 , 03:32 PM

UltraTech, led by Kumar Mangalam Birla, is in advanced talks to acquire Orient Cement Ltd (OCL) from CK Birla, as part of sector consolidation efforts, according to the Economic Times.

UltraTech aims to outbid Adani Cement and strengthen its presence in southern and western markets, specifically Maharashtra and Telangana. UltraTech recently acquired a 23% stake in India Cements, indicating its aggressive expansion plans.

The final agreement depends on reaching a consensus on valuation, and if successful, it would help UltraTech achieve its goal of 200 million tons per annum (MTPA) capacity by 2027, strengthening its industry position.

Orient Cement, based in Bhubaneswar, reported an 8.5% revenue growth to ₹3,200 Crore and a 42% increase in net profit to ₹174 Crore for Q4FY24. The company’s focus on expanding into northern markets and increasing premium cement sales highlights its growth potential.

Neither UltraTech nor Orient Cement have officially commented on the negotiations, with market observers awaiting further updates before Orient Cement’s quarterly earnings announcement on July 19.