Adani Group's Bold Cement Merger Shakes Market

Shares of Sanghi Industries dropped nearly 13% after Adani Group announced a merger of Sanghi and Penna Cement with Ambuja Cements to consolidate operations. This move seeks to streamline structure and enhance compliance. The merger, requiring approvals, is expected to finalize in 9-12 months.

Shares of Sanghi Industries experienced a significant downturn on Wednesday, plunging nearly 13% in value. The decline follows the Adani Group's announcement that it plans to merge Sanghi Industries and Penna Cement with Ambuja Cements, aiming to consolidate its cement operations into a single unit.

The stock of Sanghi Industries hit new 52-week lows, dropping to Rs 67.42 on the BSE and Rs 67.01 at the NSE. The Adani Group, which recently acquired both Sanghi Industries and Penna Cement, unveiled these consolidation plans on Tuesday, highlighting the strategic intent behind the move.

The integration is expected to streamline the organizational structure and simplify compliance demands, paving the way for more effective governance. Additionally, it will strengthen Gautam Adani's cement business to better compete with rivals like UltraTech Cements. The merger process requires necessary approvals and is anticipated to be completed within 9 to 12 months.

(With inputs from agencies.)