Adani Group Leads Race for 46.64% Stake in ITD Cementation
ECONOMY & POLICY

Adani Group Leads Race for 46.64% Stake in ITD Cementation

The Adani Group is the frontrunner to acquire a 46.64% promoter stake in ITD Cementation India, an engineering, procurement, and construction (EPC) company, to bolster its civil engineering capabilities, according to insiders. The deal, valued at ?58.89 billion ($700 million), includes an open offer that will follow the promoter stake purchase.

This acquisition marks another significant move by the infrastructure conglomerate led by Gautam Adani, which has been rapidly expanding its portfolio across sectors like airports, highways, ports, and power plants. The agreement is reportedly close to being finalized, with a formal announcement expected soon.

Strategic Fit for Adani Group ITD Cementation, a leader in maritime structures, has worked on key infrastructure projects such as the Delhi and Kolkata metro systems, and several major ports across India. Maritime structures account for 34.5% of ITD's order book, making it an attractive fit for Adani, which already has business ties with the company on hydropower and marine projects, including the Ganga Expressway.

The promoter of ITD Cementation, Italian-Thai Development Public Co, held the stake at the end of June 2023. In July, ITD Cementation had informed stock exchanges about a potential divestment of the promoter's stake, stating that the sale process was at a preliminary stage.

ITD Cementation's Growing Portfolio ITD Cementation boasts a strong presence in urban infrastructure, with projects ranging from highways, metro systems, and bridges to hydropower and specialized engineering works like tunneling and irrigation. The company’s total multi-year order book stands at ?18,536 crore, with government contracts making up nearly half of its portfolio.

ITD Cementation is also expanding into renewable energy, focusing on pumped storage and hydro projects, which align with Adani Green's 24x7 green power solutions. Analysts note that ITD's recent surge in stock value, more than tripling over the past year, may have persuaded the promoters to cash out, taking advantage of favorable market conditions.

Another Step in Adani’s Acquisition Spree The acquisition of ITD Cementation would mark the Adani Group’s 11th acquisition in 2024. The transaction is expected to be routed through Adani Enterprises Ltd (AEL), the conglomerate’s flagship company. This move follows AEL’s recent partnership with Tower Semiconductors for a $10 billion semiconductor fabrication plant in Maharashtra.

With infrastructure development gaining momentum across India, the EPC sector is poised for significant growth. ITD Cementation’s diverse portfolio, including national and international projects, is expected to complement Adani's long-term expansion strategy.

The company's management has assured that the promoter stake sale will not affect day-to-day operations, with no financial dependencies on the parent company. ITD's CFO, Prasad Patwardhan, confirmed that operations would remain unaffected, while Managing Director Jayanta Basu expressed optimism about the growth prospects under new ownership.

As India continues its infrastructure push, ITD Cementation is well-positioned to play a crucial role in shaping the country’s urban and industrial landscape under the Adani Group’s leadership.

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The Adani Group is the frontrunner to acquire a 46.64% promoter stake in ITD Cementation India, an engineering, procurement, and construction (EPC) company, to bolster its civil engineering capabilities, according to insiders. The deal, valued at ?58.89 billion ($700 million), includes an open offer that will follow the promoter stake purchase. This acquisition marks another significant move by the infrastructure conglomerate led by Gautam Adani, which has been rapidly expanding its portfolio across sectors like airports, highways, ports, and power plants. The agreement is reportedly close to being finalized, with a formal announcement expected soon. Strategic Fit for Adani Group ITD Cementation, a leader in maritime structures, has worked on key infrastructure projects such as the Delhi and Kolkata metro systems, and several major ports across India. Maritime structures account for 34.5% of ITD's order book, making it an attractive fit for Adani, which already has business ties with the company on hydropower and marine projects, including the Ganga Expressway. The promoter of ITD Cementation, Italian-Thai Development Public Co, held the stake at the end of June 2023. In July, ITD Cementation had informed stock exchanges about a potential divestment of the promoter's stake, stating that the sale process was at a preliminary stage. ITD Cementation's Growing Portfolio ITD Cementation boasts a strong presence in urban infrastructure, with projects ranging from highways, metro systems, and bridges to hydropower and specialized engineering works like tunneling and irrigation. The company’s total multi-year order book stands at ?18,536 crore, with government contracts making up nearly half of its portfolio. ITD Cementation is also expanding into renewable energy, focusing on pumped storage and hydro projects, which align with Adani Green's 24x7 green power solutions. Analysts note that ITD's recent surge in stock value, more than tripling over the past year, may have persuaded the promoters to cash out, taking advantage of favorable market conditions. Another Step in Adani’s Acquisition Spree The acquisition of ITD Cementation would mark the Adani Group’s 11th acquisition in 2024. The transaction is expected to be routed through Adani Enterprises Ltd (AEL), the conglomerate’s flagship company. This move follows AEL’s recent partnership with Tower Semiconductors for a $10 billion semiconductor fabrication plant in Maharashtra. With infrastructure development gaining momentum across India, the EPC sector is poised for significant growth. ITD Cementation’s diverse portfolio, including national and international projects, is expected to complement Adani's long-term expansion strategy. The company's management has assured that the promoter stake sale will not affect day-to-day operations, with no financial dependencies on the parent company. ITD's CFO, Prasad Patwardhan, confirmed that operations would remain unaffected, while Managing Director Jayanta Basu expressed optimism about the growth prospects under new ownership. As India continues its infrastructure push, ITD Cementation is well-positioned to play a crucial role in shaping the country’s urban and industrial landscape under the Adani Group’s leadership.

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