Adani Group's Cement Business Contributes To 30% Of India's Homes: Ambuja Cement CEO

Adani Group firm Ambuja Cements -- the second largest cement producer in the country -- contributes to nearly 30 per cent of the cement used for India's homes and infrastructure, the company said in its latest annual report.

Ambuja Cements, which has crossed 100 MTPA (Million Tonnes Per Annum) capacity in FY25 in a record time, mainly through acquisitions, now aims to reach 118 MTPA by FY 2026 and 140 MTPA by FY 2028, primarily through brownfield expansion projects.

"Ambuja Cements, now a core part of the Adani Group's cement business, contributes to nearly 30 per cent of India's homes and infrastructure. This is a story of resilience fuelled by a growth mindset -- a journey that marries legacy with innovation and is inspired by a clear and purposeful vision," said its CEO Vinod Bahety, while addressing the shareholders.

This is a story of "resilience fuelled by a growth mindset" and is inspired by a clear and purposeful vision and testament to the focused execution, agility, and ambition that define our transformation.

"A key catalyst behind this success has been our series of efficient and timely acquisitions, each completed with precision and synergy. Alongside inorganic growth, our organic expansion projects continue to gain strong momentum across the country, bringing us closer to our ambitious long-term target of reaching 140 MTPA by 2028," he said.

In FY24, Ambuja crossed the milestone of 100 million tonnes per annum (MTPA) of consolidated cement capacity, becoming the ninth largest cement company globally.

Adani Group is a new entrant in the cement sector. It jumped into the cement sector in September 2022, after acquiring controlling stakes in Ambuja Cement from Swiss firm Holcim for cash proceeds of USD 6.4 billion (about Rs 51,000 crore).

Later, Ambuja Cements, which owns a 51 per cent stake in ACC Ltd, pursued inorganic growth, acquiring small companies as Hyderabad-based Penna Cement and Saurastra-based Sanghi Industries. Earlier this year, it also acquired Orient Cement from CK Birla group.

"Having achieved nearly 50 per cent growth in just 30 months, our roadmap is clear: reaching 118 MTPA by FY26 and 140 MTPA by FY28, primarily through brownfield expansion projects," it said.

In FY26, Ambuja Cement has target of commissioning clinker and grinding units across strategic locations such as Bhatapara, Sankrail, Sindri, Salai-Banwa, Dahej, Marwar, Kalamboli, Krishnapatanam, Bathinda, Jodhpur, Maratha, and Warisaliganj.

"These projects are progressing well, with significant civil and equipment work underway," he said, adding, "Looking beyond FY26, nine additional grinding unit projects are already underway, all aligned with our vision to reach 140 MTPA by FY 2028." In FY25, Adani group's annual sales volume reached 65.2 million tonnes and its revenue stood at Rs 35,045 crore with a profit after tax of Rs 5,158 crore.

"Our strong balance sheet, marked by a debt-free status, underscores our prudent capital allocation and financial discipline," said Bahety.

Besides, Ambuja Cement is also working on cost optimisation, which according to Bahety remains a cornerstone of our strategy, enabling it to maintain competitiveness and enhance margins amid challenging market conditions.

The company has substantially reduced its logistics cost through setups such as seaborne transport. According to Cement Manufacturers' Association, the logistics costs for the industry can go as high as 30-35 per cent.

"By shifting a significant portion of our freight to seaborne transport, optimising depot locations, and leveraging GPWIS (General Purpose Wagon Inward System) and BCFC (Bulk Cement Freight Consortium) rakes, we have achieved a 6 per cent reduction in logistics costs to date," he said, adding, "Our ongoing initiatives aim for a further 15 per cent reduction in logistics costs by FY30, reflecting our continuous drive for operational efficiency." Besides, it aims for 60 per cent of its future cement capacity and 83 per cent of clinker operations to be powered by green energy.

The company is also quite bullish about the growth prospects of the Indian cement industry, where its expects a "significant" growth, driven by infrastructure projects and urban development.

"Installed capacity is expected to reach 850 million tonnes per annum by 2030 and 1,350 million tonnes by 2050," it said.

The Indian cement market is led by Aditya Birla Group firm UltraTech Cement Ltd, which has a consolidated capacity of 183.06 MTPA. It is also expanding its capacity through acquisitions and capacity enhancement as it faces competition from billionaire Gautam Adani-led Adani Group's Ambuja Cement.

It has recently acquired India Cements, Kesoram Industries' cement business and UAE-based RAKWCT. Besides, it acquired a minority stake of 8.69 per cent from the promoters of Meghalaya-based Star Cement.

(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)

(Disclaimer: New Delhi Television is a subsidiary of AMG Media Networks Limited, an Adani Group Company.)