Ambuja Cements-Sanghi Merger Gets NCLT Approval in 2026

The National Company Law Tribunal (NCLT) has granted its approval for the merger of Sanghi Industries Limited with Ambuja Cements Limited, a key entity within the Adani Group's cement portfolio. The Ahmedabad bench of the NCLT pronounced its order on February 9, 2026, clearing a significant regulatory hurdle for the consolidation. This decision marks a pivotal moment in Ambuja Cements' strategy to streamline its operations, enhance its market footprint, and solidify its position as a leading player in the Indian cement industry.

Details of the NCLT Sanction

In its official order, the NCLT deemed the scheme of arrangement to be beneficial for both companies and not detrimental to the interests of their respective shareholders and creditors. The tribunal noted that the merger is in the public interest as it promotes operational efficiency and consolidates resources. The sanctioned scheme establishes April 1, 2024, as the appointed date. This retrospective date is crucial for accounting and commercial purposes, meaning the merger is considered effective from that point, even though the final legal formalities are yet to be completed. Ambuja Cements will notify the stock exchanges once the scheme becomes fully effective.

Impact on Shareholders and Transaction Structure

The merger will integrate Sanghi Industries shareholders directly into Ambuja Cements. Under the approved terms, shareholders of Sanghi Industries will receive 12 equity shares of Ambuja Cements (face value of ₹2 each) for every 100 equity shares they hold in Sanghi Industries (face value of ₹10 each). This share swap facilitates the complete absorption of Sanghi Industries, where Ambuja Cements already holds a controlling promoter stake of 58.08%. The move is designed to unify the shareholder base under the single, larger listed entity of Ambuja Cements.

Strategic Rationale Behind the Consolidation

The primary objective of this merger is to create a more robust and efficient business structure. Ambuja Cements has stated that the amalgamation will allow for the complete absorption of Sanghi's operations, leading to more effective management and significant cost savings. The key benefits include better resource utilisation, economies of scale in procurement and logistics, elimination of duplicated corporate functions, and simplified compliance requirements. This consolidation is a core component of the Adani Group's "One Cement Platform" strategy, aimed at creating a unified and powerful cement business.

Key Merger and Financial Details

The journey to this merger began when Ambuja Cements completed the acquisition of Sanghi Industries in December 2023 at an enterprise value of approximately ₹5,185 crore. Following this, the board of Ambuja Cements approved the merger plan in December 2024.

Strengthening Market Position with Strategic Assets

Sanghi Industries brings significant strategic assets to the merged entity. Its Sanghipuram facility in Gujarat is one of India's largest single-location cement and clinker manufacturing plants. This facility is supported by vast limestone reserves estimated at one billion tonnes, a captive power plant, and a captive jetty, which enhances logistical efficiency for coastal distribution. The integration of these assets will substantially bolster Ambuja's manufacturing footprint, particularly in the key markets of western and southern India.

Adani Group's Broader Cement Ambitions

This merger is a critical piece of the Adani Group's ambitious plan to become India's largest cement manufacturer. The group is aggressively pursuing both organic and inorganic growth to reach a target cement capacity of around 140 million tonnes per annum (MTPA) by the fiscal year 2028. The consolidation of Sanghi Industries, along with other proposed mergers like that of Penna Cement Industries, is designed to accelerate this growth. By creating a single, streamlined entity, the group aims to strengthen cash flows, support faster expansion, and deepen its market penetration across the country.

Market Reaction and Future Outlook

The market responded positively to the NCLT's approval, with shares of Ambuja Cements closing approximately 2.5% higher at ₹542.70 on the NSE on the day of the announcement. The approval removes a major uncertainty and allows the company to proceed with unlocking the anticipated synergies from the merger. The focus will now shift to completing the final procedural steps to make the scheme effective. Investors and industry analysts will be closely monitoring the integration process and the company's ability to realize the projected cost savings and operational efficiencies. The successful integration of Sanghi's assets is expected to fortify Ambuja's competitive position against market leader UltraTech Cement and support its long-term growth trajectory.