Explaining the long arc of the relationship, Rakesh Arora, Founder, Go India Advisors highlighted how deep-rooted the partnership already is. “First of all, it has been 25 years of courtship before this marriage, so it has been a long journey. Ambuja bought a stake in ACC in 2001 or something like that. So, it has been 25 years in making.” From a valuation lens, he pointed out that the transaction effectively translates into acquiring sizeable capacity at an attractive cost. “This is equal to buying around 22 million tonne of capacity at around $81 per tonne. Now, company like Ambuja trades at $140 to $150 even in a bear market like this.”
That gap, according to Arora, creates immediate value for Ambuja shareholders. “There is an immediate value add of around $1.1 to $1.2 billion, so which is around equal to 10% of current market price of Ambuja, so that is the value add which investors in Ambuja would see.” On operational synergies, he noted that most benefits are already visible. “Synergy benefits are largely done, meaning they have indicated around Rs 100 and I do not really see too much of change in the market dynamics for the cement industry.” Importantly, regulatory comfort also plays a role. “Since they already had the majority controls even CCI approval is not required. So, even CCI does not believe that it is going to change pricing dynamics.”
From the perspective of ACC shareholders, valuation remains a key question. Arora acknowledged the stock’s long period of stagnation. “ACC shareholders were stuck in a range for last five years now. The stock has not done anything at all. In comparison Ambuja stock is up some 70-80% during that period.” He cautioned against overreading the swap ratio, adding, “I would not really read too much into the swap ratio and all that.”
On operating performance, especially EBITDA per tonne, Arora suggested that differences between the two companies are narrowing. “There was a minor difference earlier, already the company is taking steps, so the difference between Ambuja and ACC EBITDA per tonne is not likely to be huge and would even out further as these synergy benefits kick in.” Over time, this convergence could support a more consistent valuation framework for the combined entity.
Looking ahead, the amalgamation does not necessarily signal an end to inorganic growth for the Adani Group. Arora remained cautious on drawing that conclusion. “With Adanis around I do not think I will take that conclusion, meaning they can swing deals further.” He pointed to recent and pending transactions. “Already there is Jaiprakash Associates which they have recently acquired so that will get merged, that is another 7-8 million tonne capacity. Sanghi merger is still due, so that will also happen.” Even beyond these, he sees optionality. “There are still some targets which are available at the right price Adanis might move in.”Overall, while large-scale consolidation may slow due to a shrinking pool of sizeable assets, the ACC–Ambuja merger reinforces the Adani Group’s intent to balance operational efficiencies with strategic flexibility, keeping both organic expansion and selective acquisitions firmly on the table.
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