As the acquisition of ACC Ltd. and Ambuja Cements Ltd. formally concluded on Friday, making Adani Group the second-largest cement maker in the country, brokerages weighed in on the new appointees to the company boards, fundraising plans and the road ahead for the sector.
While billionaire Gautam Adani has been appointed as chairman on Ambuja Cements’ board, his elder son Karan Adani will take charge of ACC Ltd. Karan will also be a non-executive director at Ambuja Cements.
Vinay Prakash and Arun Kumar Anand were appointed as non-executive, non-independent directors at ACC. Sandeep Singhi, Nitin Shukla and Rajeev Agarwal were named as independent directors. Sridhar Balakrishnan has been re-designated as whole-time director and chief executive officer from managing director and CEO earlier.
Ajay Kapur has been appointed as whole-time director and CEO of Ambuja Cements. Vinod Bahety was named as chief financial officer of ACC and Ambuja Cements.
On Friday, Ambuja Cements’ board approved raising Rs 20,000 crore through issue of convertible warrants to Harmonia Trade and Investment Ltd. The cement maker will issue 47.74 crore warrants representing a 19.39% stake in the company, it had said in an exchange filing.
The issue price of the convertible warrants was set at Rs 418.87 apiece.
Chairman Adani, in an event, said the group aims to expand its capacity to 140 million tonnes in five years from about 70 million tonnes currently.
Shares of Ambuja Cements rose as much as 9.35% to Rs 565 apiece, while that of ACC gained 3.94%.
Of the 47 analysts tracking Ambuja Cements, 19 maintain ‘buy’, 16 recommend ‘hold’ and 12 suggest ‘sell’. The return potential of the stock is -27.9%.
Of the 46 analysts tracking ACC, 23 maintain ‘buy’, 12 recommend ‘hold’ and 11 suggest ‘sell’. The return potential of the stock is -15.4%.
Here’s what brokerages made of the board rejig and fundraising plans…
