After tasting success in airport and ports businesses, Gautam Adani is all set to enter the cement industry. Adani Enterprises, his flagship company, informed stock exchanges on Saturday that it has incorporated a wholly-owned subsidiary by the name of Adani Cement.
In its filing, Adani Enterprises informed that Adani Capital has a authorised share capital of ₹10 lakh and paid-up share capital of ₹5 lakh. The fresh subsidiary has 50,000 equity shares of ₹10 each, it added.
The newly minted company has been registered with Registrar of Companies, Gujarat on June 11, 2021, and is yet to begin operations. So the company does not any turnover yet, it clarified.
Adani Enterprises stated that Adani Cement will operate as "manufacturers, producers and processors of all types of cement".
The diversification attempt from Adani does not seem surprising given the spurt in his wealth. The 58-year old business magnate has been the best wealth creator so far in 2021, adding $43 billion to his net worth. His port-to-power conglomerate already has interest in sectors ranging from FMCG to airport management and power transmission.
Adani's bet on the cement business might have been encouraged by the central government's push to revive capital expenditure, which is usually directly proportional to performance of this sector. His entry into the market could be an indication of good prospects in the cement industry once the pandemic subsides.
This development is likely to cause some disruption in the competitive India cement industry, which has been preparing for a revival after taking hits from Covid and earlier troubles.
Adani could borrow the playbook from his ports and airports business, where he hold substantial market shares. This would mean aggressive acquisitions to build up his cements business.
It will also be interesting to see if Adani could tap into the financial prospects of his new subsidiary, the same way he did with his power transmission and gas arms. Both Adani Total Gas and Adani Transmission, along with Adani Enterprises have posted stellar performances on the stock market, adding heaps of wealth to the billionaire's name.
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Gautam Adani forays into cement business, incorporates Adani Cement - Mint
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