Shares of Orient Cement rallied over 12% in early trade on Wednesday, in an otherwise weak broader market, amid a report that Adani Group, which recently completed the acquisition of Ambuja Cements and ACC, is in talks to buy promoter stake in the company. However, there is no official confirmation on this. The Bombay Stock Exchange (BSE) has also sought clarification from The CK Birla group firm, and the reply is awaited.
Reacting to the news, Orient Cement share price opened 5.85% higher at ₹140.2 against the previous closing price of ₹132.45 on the BSE. In the first two-hour of trade so far, the stock gained as much as 12.2% to hit a high of ₹148.7, while the market capitalisation surged to ₹3,000 crore. In comparison, the BSE Sensex was trading 332 points lower at 60,961 levels, with all sectors flashing in red, except healthcare.
Orient Cement shares have risen 47% in the past six months, from its 52-week low of 95.65 on May 20, 2022, while it has gained nearly 12% in a month. Despite the recent rally, the cement stock trades 24% lower than its 52-week high of 184 touched on February 7, 2022. In the last one year, the smallcap stock has given a negative return of 11%.
At the end of the September quarter, promoter group entities owned a 37.9% stake in the company, while public shareholders held the remaining 62.1% shares in the firm.
For the second quarter ended September 2022, Orient Cement logged a net loss of ₹9.49 crore compared to a net profit of ₹56.88 crore in the year-ago period. Revenue from operation rose marginally to ₹615.28 crore as against ₹613.12 crore in the same period last year. Total expenses in the September quarter were ₹630.19 crore, up 18.8% from the year-ago period.
Recently, Adani Group was in news to acquire the cement businesses of debt-laden Jaypee Group, which was later declined by the company. The Jaypee Group finally sold the group's cement business to Dalmia Cement.
Billionaire Gautam Adani-led Adani family forayed into the cement industry by buying out Holcim's stake in Ambuja Cements and ACC for $10.5 billion, making it the largest-ever acquisition by Adani. Post the acquisition, the ports-to-energy conglomerate became the nation’s second-largest cement maker, after UltraTech, with an annual production capacity of 67.5 million tonnes. The conglomerate plans to double his group’s cement manufacturing capacity to 140 million tonnes per annum by 2030.