UltraTech Cement, a flagship company of the Aditya Birla Group and India's largest cement manufacturer, is set to offload a 6.49% stake in India Cements through an open market offer for sale. The decision, approved by UltraTech's Committee of Directors and Officers on Wednesday, August 20, 2025, aims to comply with regulatory requirements mandating a minimum public shareholding for listed companies.
Details of the Stake Sale
The stake sale involves offloading 20,112,330 equity shares of India Cements. The offer for sale (OFS) is scheduled to take place between August 21 and August 22. The floor price for the OFS has been set at ₹368 per share, a slight discount compared to India Cements' closing price of ₹370 on Wednesday. Based on Reuters calculations, the deal is valued at ₹7.45 billion ($85.6 million).
Rationale Behind the Offload
The primary reason for the stake sale is to meet the minimum public shareholding (MPS) requirements stipulated by the Securities and Exchange Board of India (SEBI). SEBI mandates that controlling shareholders, referred to as promoters in India, can hold a maximum stake of 75% in a listed company. As of June 2025, UltraTech held an 81.49% stake in India Cements. The sale of 6.49% stake will bring UltraTech's holding down to the permissible 75% level. India Cements has until February 3, 2026, to comply with the MPS norms.
UltraTech's Acquisition of India Cements
UltraTech Cement gained control of India Cements in July 2024. In June 2024, UltraTech acquired a 24% stake from investor Radhakishan Damani, followed by a 32.8% stake from the founding family of India Cements, including N. Srinivasan. This triggered an open offer for an additional 26% stake from public shareholders, which was oversubscribed. The acquisition cost UltraTech ₹3,954 crore for a 32.72% stake in India Cements from promoters and associates. Following the stake purchase and open offer, UltraTech’s stake in India Cements increased to 55.5%. India Cements officially became a subsidiary of UltraTech on December 25, 2024.
UltraTech's Capacity Expansion and Future Plans
UltraTech Cement is on a path of aggressive expansion, aiming to exceed 200 million tonnes of production by FY26. In FY25, the company added 42.6 MTPA of capacity, with 16.3 MTPA through organic expansion and 26.3 MTPA through acquisitions, including India Cements and Kesoram Industries. As of March 2025, UltraTech's total production capacity stood at 188.8 MTPA. Kumar Mangalam Birla, Chairman of UltraTech Cement, stated that the company is poised to become the largest cement-selling company in the world outside of China.
In the first quarter of FY26, UltraTech's net revenue was ₹21,275 crore, compared to ₹18,819 crore in the same period last year, with a 49% jump in profit after tax (PAT) to ₹2,226 crore. The company added 3.5 MTPA of grey cement capacity in Q1, bringing the total capacity to 192.26 MTPA. UltraTech plans to invest ₹9,000-10,000 crore on capital expenditure in FY26 to support its growth initiatives.
India Cements' Performance and Outlook
India Cements has a capacity of 14.45 MTPA. In FY 2024-2025, India Cements Ltd. reported its revenue at Rs. 4,148.8 Cr, an decrease of 19% compared to the previous financial year. The profit after tax or PAT decrease by 39% compared to last year and stood at Rs. 132.2 Cr. The EBITDA of India Cements Ltd. was Rs. -173.7 Cr in FY 2024-2025.
Market Reaction
Following the announcement, India Cements' stock ended 0.8% lower at ₹370.25, while UltraTech's shares closed 0.07% higher at ₹12,872 on the NSE. UltraTech Cement's shares were trading at ₹12,860 per scrip at 15:42 PM after a 0.03% increase on the BSE.
