The country?s cement is sector set to see increase in merger and acquisition (M&A) activity after a lull of more than a decade as global majors like CRH and Heidelberg, LafargeHolcim are looking to expand their presence in India.
The LafargeHolcim combine with a cement capacity of around 68 mtpa in India has overtaken Kumar Mangalam Birla?s UltraTech, so far the largest cement manufacturer in India with a capacity of 65 mtpa. However, the Aditya Birla Group company seeks to expand its capacity to 71 mtpa by 2016 with projects underway.
Puneet Dalmia, Managing Director of Dalmia Cement, feels that global consolidation in the cement sector is happening in India as well. "There were two major deals in last 7-8 months – Holcim Lafarge and then Heidelberg and Italcementi. Globally the ticket size in cement will be 100 mt and in India it will be 20 mt. Here, number of big players are increasing and going forward more consolidation will take place. To survive in India a 20 mt capacity is essential, which would entail an investment of Rs 12,000 crore. The group has a capacity of 24 mt," said Dalmia.