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The shares of Ambuja Cements Limited zoomed 10 per cent on Monday’s early trades to hit a record high of ₹ 572.00 apiece on the bourses. The stock surpassed its previous 52-week high of ₹ 550.15 apiece that it had touched on Friday, following the Adani Group’s plans to infuse ₹ 20,000 crores in the company. 

Ambuja Cement’s new board, on September 15, 2022, approved an infusion of ₹ 20,000 crores in the company by way of preferential allotment of 477.5 million convertible warrants at a price of ₹ 419 to Harmonia Trade and Investment (promoter entity) on a preferential basis. It said that the issuance of warrants can be exercised and converted into equity shares in one or more tranches within 18 months. 

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The Adani Group has completed the acquisition of Ambuja Cements and its subsidiary ACC. With this, it has become the country’s second-largest cement player.

The boards of Ambuja Cements and its subsidiary, ACC, were reconstituted on Friday. Gautam Adani was appointed as the chairman of Ambuja Cements while his elder son Karan Adani was named as a director of both the cement firms and chairman of ACC. 

The new promoters of the company have stated that they want to double the group’s cement capacity in the next five years and become the largest and most efficient cement company by 2030. The company has exposure to energy and logistics and the management believes that this will help them to improve cost dynamics and gain supply chain efficiencies. 

Motilal Oswal Financial Securities commented that this approval signal’s the promoters’ intent for growth and commitment to further investments in the cement business. The brokerage added that promoters’ shareholding will increase to 70.3 per cent v/s 63.2 per cent at present, upon the conversion of these warrants. 

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Written by Simran Bafna 


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