Billionaire Gautam Adani’s family has infused a significant sum of ₹8,339 crore into Ambuja Cements, effectively increasing its stake in the construction materials giant to a commanding 70.3%. This bold financial maneuver comes as the latest in a series of investments aimed at propelling the company’s manufacturing capabilities to new heights.
Before this recent capital infusion, the Adani family had committed substantial funds to Ambuja Cements on two previous occasions: investing ₹5,000 crore on October 18, 2022, and a further ₹6,661 crore on March 28, 2024. With the additional ₹8,339 crore, the family has now fully realized their ₹20,000 crore investment plan for the company. In an official communication, the company expressed that, “The promoters of the company – Adani family – has fully subscribed to the warrants program in the company by further infusing ₹8,339 crore, thereby infusing a total amount of ₹20,000 crore.”
This latest investment hike gives the Adani family a 3.6% rise in their stake, taking it from 63.2% to 70.3%. The strategic injection of funds is set to assist Ambuja Cements in its ambitious growth agenda, with plans to nearly double its current production capacity. The target? To reach a staggering 140 million tonnes per annum by 2028 from 76.1 million tonnes as of the end of the prior year.
Ambuja Cements detailed how the financial reinforcement will arm the company with “capital flexibility for accelerated growth, capital management initiatives and best-in-class balance sheet strength to accomplish its various strategic initiatives.” This momentum arrives on the heels of the Adani group’s 2022 takeover of the cement sector, courtesy of a massive $10.5 billion acquisition of both Ambuja and ACC from the Swiss conglomerate Holcim.
The funding influx is anticipated to shore up the company’s financial health robustly, setting the stage for Ambuja to chase aggressive expansion goals while staying agile to seize opportunistic market openings. According to the company’s statement, the investment magnifies the Adani family’s commitment to robust capital management across its portfolio companies and attests to their resolve to expand the potential of the cement division.
This capital boost is expected to have a multi-pronged impact. It will not only assist in capacity augmentation but will also support various strategic undertakings, including targeted capital expenditure for debottlenecking production hitches and pushing operational performance. Ambuja Cements has expressed intentions to capitalize on this opportunity to drive innovation, enhance product offerings through integration with cutting-edge technology, and optimally serve the burgeoning sector requirements fueled by expansions in the Indian economy.
Ajay Kapur, the CEO of Ambuja Cements Ltd, conveyed excitement over the significant investment completion. He stated, “This infusion of funds provides Ambuja, capital flexibility for fast-tracked growth, capital management initiatives and best-in-class balance sheet strength. It is not only a testament to a steadfast belief in our vision and business model but also reinforces our commitment to delivering long-term sustainable value creation to our stakeholders, and this shall propel us towards setting new benchmarks, accelerating our growth, and continuing to deliver on operational excellence, business synergies, and cost leadership.”
The transaction saw international banking majors such as Barclays Bank PLC, MUFG Bank, Mizuho Bank, and Standard Chartered Bank play advisor roles, marking another milestone in Ambuja Cements’ journey towards establishing a dominant position within the competitive cement industry – under the sturdy financial wing of the Adani family.
