ACC and Ambuja Cements move one step closer to a merger: Angel Broking

Views of Angel Broking:

"In separate filings with the stock exchange, ACC and Ambuja Cements announced they were exploring a full-fledged merger. The merged entity will be India's second largest cement company in terms of market value. Ultratech Cements, which was created by consolidating the cement operations of L&T and the A V Birla Group, will still remain the largest cement company in India. Currently, both ACC and Ambuja are group companies LafargeHolcim of France, which was formed by the merger of Lafarge of France and Holcim of Switzerland.

LafargeHolcim currently owns 66% in ACC and 55% in Ambuja Cements. The proposed merger appears to be timed to capitalize on the emerging opportunities in this sector. India is already the second largest producer of cement in the world. However, India's cement consumption per capita is much lower than other emerging markets. India's cement capacity is expected to increase to 550 million tonnes per annum (MTPA) by 2025. That will still be 1/5th of China's capacity, but the inevitable journey towards consolidation has surely begun. The ACC/Ambuja merger is indicative of this larger wave of cement sector consolidation."

Shares of ACC LTD. was last trading in BSE at Rs.1693.05 as compared to the previous close of Rs. 1694.15. The total number of shares traded during the day was 23925 in over 1461 trades.

The stock hit an intraday high of Rs. 1723.15 and intraday low of 1682.2. The net turnover during the day was Rs. 40709200.

Source : Equity Bulls

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