Adani-Holcim Deal: Here’s the real reason behind the deal! Therefore the demand for cement will increase

Gautam Adani (File Photo)

Ambuja and ACC currently have 23 cement plants, 14 grinding stations, 80 ready mix concrete plants and 50,000 channel partners across India. Now Adani Group will get the benefit of this entire business. Adani Group currently has India’s largest renewable energy business. In this, Adani Group will benefit from the new cement business.

What was discussed for many days, finally proved to be true. Adani Group has acquired the world’s renowned cement company Holcim (Holcim) has bought the business in India. Holcim Group has two subsidiaries in India namely Ambuja Cement and ACC Cement (ACC Cement) names. Holcim was handling the business of both these companies till now. But now this work is done by Gautam Adani’s company. Adani Group ,Adani Group) will do. The business of these two cement companies was going slow for a long time, which is now expected to pick up. A $10.5 billion deal has been signed between Adani Group and Holsim. At present Ambuja and ACC produce 700 lakh tonnes of cement a year. Adani Group has set a target of increasing this production to 1400 lakh tonnes in the next 5 years.

Many important reasons are being told behind this mega deal between Holsim and Adani Group. The most prominent of these reasons is the increasing demand for cement in India. At present, per capita cement consumption in India is 242 kg while internationally it is 525 kg. There is a huge gap in the demand for cement in India and internationally, which is expected to grow rapidly. In India, the next few years are going to be very important in terms of cement because along with real estate, the construction of pucca houses in government schemes will pick up. In terms of per capita consumption, India is still more than double behind at the international level. This potential demand from the cement sector has played an important role in the agreement between Holcim and Adani Group.

Cement industry benefits from urbanization

Rapid urbanization is taking place in India and rural population is moving towards cities. Now the villages are also getting equipped with the amenities of cities, in which house construction comes first. In this, the consumption of cement is continuously increasing. The rise of people above the poverty line and the increase in the number of middle class is increasing the demand for cement. As the time is increasing, the demand for affordable housing is increasing. The government is also running many schemes in which affordable housing is being promoted. In all these works, the consumption of cement will increase, which is the focus of the Adani Group. During Kovid, the work of housing construction or infrastructure had come to a standstill, which has now increased. Further increase will be seen in this in future. There will be a huge demand for cement in both these areas for the next several decades.

Adani Group’s business will grow like this

By buying the business of Ambuja and ACC, many factories and factories will come to Adani Group. With this, the Adani Group will get an accumulated business, for which the company will not need to make any separate effort. Ambuja and ACC currently have 23 cement plants, 14 grinding stations, 80 ready mix concrete plants and 50,000 channel partners across India. Now Adani Group will get the benefit of this entire business. Adani Group currently has India’s largest renewable energy business. In this, Adani Group will benefit from the new cement business.

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India far behind China

In the next few decades, cement is going to play a big role in the development of India, which has also been mentioned by Gautam Adani, Chairman of Adani Group. According to Adani, India will remain the world’s largest demand-driven economy for several decades. At the same time, India will continue to be the second largest cement market in the world, while the truth is that less than half of the cement is consumed in India internationally. According to statistics, China consumes 7 times more cement than India. Adani Group already has logistics business, renewable energy as well as real estate business. In all these businesses, the Adani Group will get a big benefit from Holcim’s cement agreement.