UltraTech Cement will acquire Wonder WallCare, a manufacturer of wall putty, for an enterprise value not exceeding Rs 235 crore as part of its aggressive expansion strategy. This acquisition will enhance the portfolio of value-added products for the country’s largest producer of cement.
Wonder WallCare, a wholly owned subsidiary of Wonder Cement, has a manufacturing plant for wall putty and related products with a capacity of 600,000 tonne per annum at Rajsamand in Rajasthan.
One of the largest single-location putty manufacturing plants in the country, the facility was constructed in 2022-23, and can be expanded going ahead, UltraTech said in filing with stock exchanges on Thursday.
The deal is expected to be closed in 90 days, subject to regulatory approvals and compliances. Wonder WallCare had a turnover of Rs 78.61 crore in fiscal 2023-24 and Rs 20.36 crore the year before that.
“This acquisition will help the company expand its putty and value-added products’ production capacity in the highly competitive and fragmented putty manufacturing market in India,” UltraTech said.
Wonder WallCare’s plant is situated in the pithead of large high quality raw material reserves, and in close proximity to UltraTech’s existing putty manufacturing facilities in Rajasthan.
UltraTech currently has a grey cement capacity of 188.76 million tonnes and white cement/putty capacity of 2.7 million tonnes. It has three wall care putty units and sells the product under the ‘Birla White’ brand.
Late in December, UltraTech bought an 8.69% stake in Meghalaya-based cement maker Star Cement from its promoter group for Rs 851 crore. This acquisition gave Ultratech a foothold in the north-eastern market as well as one of the most profitable companies of the region.
In June last year, Ultratech acquired a 22.77% stake in India Cements. Even though Ultratech had then said that the move was only a financial investment, within months it took over the business from N Srinivasan and family, and currently holds an 81.49% stake in the company.
UltraTech had also acquired the cement business of Kesoram Industries late in 2023.
The country’s top two cement producers — UltraTech Cement of the Aditya Birla Group and Adani Cement of the Adani Group — have been aggressively adding to their capacities over the last few months as they look to strengthen their dominance in the world’s second-largest market for cement.
At its annual general meeting in 2023, chairman Kumar Mangalam Birla said UltraTech would surpass 200 million tonnes in production capacity. In 2024, Birla said the company was on track to cross this mark by 2026-27 with its ongoing capacity expansions and acquisitions of Kesoram Cement and India Cements.
The company is likely to commission another 26.5 million tonnes of capacity in the current fiscal year and the next.
Adani Cement, meanwhile, plans to have a production capacity of 140 million tonnes by 2027-28. The Adani Group had acquired Swiss firm Holcim with a near 70 million tonne capacity in 2022. Some of its large acquisitions include Saurashtra-based Sanghi Industries and Penna Industries and Orient Cement.
