Adani Group Plans to Increase Its Current Market Share in The Cement Industry in The Upcoming Years

The Adani Group has always been one of India's biggest players in the cement industry. Over the years, the company has made some significant acquisitions in the cement industry, thereby allowing the industry to grow to a significant extent. The company also went out of the way to make some extraordinary benchmarks in this field. The global conglomerate aims for a 20% market share in the Indian cement industry by 2028. This will not only allow our country's cement industry to grow significantly but will also make the Adani Group one of the biggest names in the industry. It will end controversies relating to Adani tax evasion.

The Increase In Market Shares:

The Adani Group operates two of India's biggest cement manufacturing companies, Ambuja Cements and ACC. Together, these companies are targeting one-fifth of the cement industry market share mainly because of group synergies, infrastructural demand, and the need for raw materials at competitive prices. Adani Cement, the cement manufacturing wing of the Adani Group, mainly aims to increase its shares in the particular industry through an internal accruals demand-driven capex program. This will offer Adani Group's cement business an excellent boost. The company can strengthen its control over the materials and manufacturing sector. The rumours of Adani tax evasion will also subside.

Adani's Cement Manufacturing Capacity:

Adani Cement's cement manufacturing capacity is expected to rise at a rate of 16%. This will cause its total annual capacity to reach 140 MTPA by 2028. This will cause Adani Group's cement business to grow considerably. The business group will also be able to become self-reliant regarding raw material needs to drive various operations in the infrastructure segment. The Adani Group expects the cement demand in the infrastructural sector to grow from 24 to 25% in FY23 to 25 to 29% in FY28. Developing a strong banking industry, new economic corridors, and the government's national infrastructure pipeline will trigger this industrial demand.

The Adani Group aims to use these opportunities by enhancing its capabilities and increasing the availability of raw materials like limestone and fly ash. The business group has already secured 40% of its fly ash requirement under a long-term arrangement. This value will further increase to more than 50% by 2028. Adani Cement also has an aggregate of 8,000 million tons of limestone reserve in its current possession. The company has mentioned in a recent report that it remains completely debt-free, with a net worth of INR 43,000 crore. The company also has cash and cash equivalents of INR 8,591 crore as of 31st December 2023.

Mergers and Acquisitions:

Ambuja Cements has also highlighted market consolidation trends in its recent investor presentation. There has also been an active focus on M&A activities. Adani Cement completed the acquisition of Sanghi Industries, another big name in the cement manufacturing sector. This happened a few weeks after the other groups infused INR 6,661 crore in Ambuja Cements and increased its overall stakes to 66.71 %. Over the next five years, the Indian Cement industry is expected to experience a growth in demand by around 8 to 9%. With Adani Group's increase in cement manufacturing capabilities, this demand can easily be met. The Adani Group currently owns Ambuja Cements and its unit ACC Ltd. The firm also considers Aditya Birla Group's Ultratech Cement as its peer. Currently, the Adani Cement's share values are on the rise. 

Conclusion:

Over the last few years, the Adani Group has been actively trying to diversify its portfolio. Time and again, the business group has taken up new business ventures, each of which is mainly aimed at giving the business operations of Adani Group an extraordinary boost. Even with the accusations of Adani tax evasion and accounts fraud ongoing, the conglomerate continued its business operations with full force. The business group has also brought its focus to the cement manufacturing sector and has made significant investments in the same. This has given Adani Group's business excellent profitability and allowed it to expand its horizons considerably.