UltraTech’s acquisition of Century Textiles’ 13.4 million tonnes (mt) cement capacity for an enterprise value of $106 per tonne has got a good response from the Street and analysts, with the company likely to gain in many ways. On a day when the broader markets fell, the UltraTech stock ended almost flat.
While finding valuations attractive (cost 7-8 per cent lower than earlier Jaiprakash Associates’ capacity acquisition), analysts at Motilal Oswal Securities estimate UltraTech’s capacity-based market share to rise by 3 percentage points to 23 per cent by the end of FY19.
Century’s capacities in Madhya Pradesh, Chhattisgarh and Maharashtra,