India is now the second largest producer of cement, with an established capacity of 550 million tonnes, 8% of the total international capacity of 6,875 million tonnes.
The Gautam Adani-led Adani Group, encompassing Ambuja Cements and ACC Ltd, has set ambitious targets to solidify its presence in the Indian cement market. With a strategic focus on accelerated expansion and efficient operations, Adani Cement aims to capture approximately one-fifth of the market by fiscal year 2028.
Aggressive Capex Program and Debt-Free Strategy
Adani Cement plans to execute its accelerated capital expenditure program using internal accruals while maintaining a debt-free status.
The company is committed to a robust growth trajectory, targeting a capacity expansion to 140 million tonnes per annum (MTPA) by FY2028, representing a growth rate of 16%.
Strategic Market Positioning
Currently holding a 14% market share, Adani is positioned as the second-largest player in the industry, following UltraTech Cements. With a strategic objective to increase its market share to 20% by FY28, Adani Cement is poised for significant growth and market consolidation.
Enablers for Capacity Enhancement
The Adani Group has strategically secured land for capacity expansion, with several acquisitions in advanced stages. With access to substantial limestone reserves, a key raw material for cement production, Adani is well-positioned for sustainable growth.
Synergies and Cost Leadership
Benefiting from synergies within the group, Adani emphasizes cost leadership and operational efficiency. Approximately 65% of the total cost of cement production enjoys synergies with the group or leverages the group’s market leadership, providing a competitive advantage.
Financial Strength and Growth Prospects
Ambuja Cements, along with its subsidiaries, remains debt-free with a robust net worth of Rs 43,000 crore and significant cash reserves of Rs 8,591 crore as of December 2023.
The company’s strong financial position, coupled with favorable industry growth projections of 7 to 8% CAGR, underscores its promising outlook in the Indian cement sector.
As Adani Cement continues its expansion journey, driven by strategic investments, operational excellence, and market leadership, it is poised to play a pivotal role in shaping the future of the Indian cement industry.
