 "Shree Cement")
Shree Cement has exited the race to acquire Ahmedabad-based Sanghi Cement citing change in its business plans. Prashant Bangur, vice chairman of Shree Cement, said that after preliminary due diligence, the company had decided not to go ahead with plans to buy Sanghi Cement. “Given our pipeline of projects, we have decided to focus on organic growth rather than inorganic growth,” he said. Shree Cement has set a target of reaching 80 million tonnes capacity by 2030. This would be achieved through brownfield and greenfield expansion. The company’s current capacity is 48 mt. Banking sources said Ultratech and Ambuja Cements were in the race for the firm which has a capacity of 6.1 million tonnes per annum and an enterprise valuation of ~6,000 crore. When contacted, UltraTech, Adani group officials did not comment on the issue.
India Ratings and Research downgraded Sanghi Industries (SIL) long-term rating to default category from ‘IND BB’ with negative outlook. The rating firm said the downgrade reflects SIL's rescheduling of its interest obligations on the rated NCDs due to liquidity issues. "This is in line with Securities and Exchange Board of India’s Operational Circular for Credit Rating Agencies dated 6 January 2023, which states that rescheduling of debt instruments by lenders prior to the due date of payment to avoid default or bankruptcy will be treated as default. The agency believes that the rescheduling has been due to liquidity challenges asthe company did not have any material cash balance on 30 June 2023 and its available liquidity buffer in the form of unused fund-based limits (after considering devolved letters of credit) was only around Rs 2 crore, lower than the interest obligations towards the NCDs," the rating firm said.
