Adani Group firm Ambuja Cements announced on June 13 the acquisition of Penna Cement Industries Ltd (PCIL) for Rs 10,422 crore. This deal, which expands its footprint in southern India, marks Ambuja’s fourth major acquisition since the Adani Group’s entry into the cement industry via Ambuja in September 2022.

Penna Cement, headquartered in Hyderabad and promoted by P Prathap Reddy and his family, has an annual production capacity of 14 million tonne, with an additional 4 million tonne currently under construction.

The Adani Group is actively expanding its cement portfolio, as it pursues acquisitions such as Saurashtra Cement, Jaiprakash Associates, and Vadraj Cement, aiming to secure approximately 20% of the Indian cement market by the fiscal year 2028.

According to an Economic Times report, the Adani Group has earmarked $3 billion for its ambitious cement plans.

Currently, Adani Cement ranks as the second-largest player in the sector, following UltraTech.

Congress leader Jairam Ramesh criticised the government’s alleged favouritism towards certain businesses, citing a series of Adani’s acquisitions on social media platform X (formerly Twitter).

Ramesh begins his post with “aap chronology samajhiye”, which says that in September 2022, Adani acquired Ambuja Cements and ACC, becoming the second-largest cement producer in India. In August 2023, Adani took over Sanghi Industries, the largest single-location cement plant in the country. By June 2024, Adani had acquired Penna Cements, thus consolidating its presence in southern India.

Ramesh noted that Adani is considering the acquisition of Saurashtra Cement, Vadraj Cement, and Jaiprakash Associates’ cement business.

“As Former RBI Deputy Governor and noted financial economist Dr. Viral Acharya established, 5 big conglomerates – including the Adani Group – are building monopolies in 40 sectors, including cement. This growing monopolization is linked to India’s shaky economic growth, unemployment crisis, and high inflation. In 2015, when a common man used to spend ₹100 on goods, ₹18 would go as profit to the business owner –– in 2021, the owner now gets ₹36 in profits,” Ramesh’s post said.

“Firms must grow. Companies must expand. But at the same time, the Government has a responsibility to ensure competition is not stifled, oligopolies or monopolies do not emerge, takeovers are free and fair, and undue advantage arising out of access to political power is not exercised,” he added.

With demand projected to increase at a compound annual growth rate (CAGR) of 7-8% over the next five years, the Indian cement industry is on a growth path. The Adani Group’s ambitious expansion plans follow this growth trend.

Ambuja Cements, along with its subsidiary ACC Ltd, has a production capacity of 77.4 million tonnes annually, supported by 18 integrated cement manufacturing plants and 18 cement grinding units spread across India.