JULY 20248TOP STORIESRADHAKISHAN DAMANI FOREGOES OWNERSHIP OF STAKE IN INDIA CEMENTSMAHARASHTRA'S GSDP GROWTH IN LINE WITH STATE SURVEY ESTIMATIONSUltraTech Cement has acquired a 23 percent stake in India Cements for approximately Rs 1,900 crore. This strategic move prevents potential future bids for the prominent peninsular manufacturer as competition intensifies to control capacities in the highly regionalized and freight-intensive cement industry, which is the second largest in the world after China. The shares were purchased from billionaire investor Radhakishan Damani, his family members, and his investment firms, Derive Investments and Derive Trading and Resorts.UltraTech, part of the Aditya Birla Group and the largest cement manufacturer in India, acquired 70.6 million shares of India Cements at up to Rs 267 per share, classifying it as a "non-controlling financial investment," according to filings made on Thursday morning. Manish Valecha, a research analyst at Anand Rathi Institutional Equities, noted that by investing Rs 1,900 crore, UltraTech has effectively blocked the capacity of almost 15 million tonnes. This acquisition follows closely on the heels of Adani Cement's announcement earlier this month regarding its buyout of south-based Penna Industries, which has a 14-million-tonne capacity. Adani Cement and JSW Cement were also reportedly interested in acquiring Damani's stake in India Cements.With this acquisition, UltraTech Cement, which already boasts a capacity of over 150 million tonnes in the world's second-largest cement-manufacturing and consuming market, is well on its way to achieving its targeted production capacity of 200 million tonnes by March 2027. Currently holding a 23-24 percent market share in India, UltraTech has added more than 50 million tonnes of capacity over the past five years, with 19 million tonnes added in a single year alone. Maharashtra, the leading contributor to India's national nominal GDP, is projected to experience a 7.6 percent economic growth in 2023-24, mirroring the country's anticipated growth rate of 7.6 percent, according to the state's latest Economic Survey. The agriculture and allied activities sector, impacted by the "scarcity situation," is expected to grow by 1.9 percent. Meanwhile, the industry sector is anticipated to expand by 7.6 percent and the services sector by 8.8 percent over the last fiscal year.The Economic Survey 2023-24 was presented by Deputy Chief Minister Ajit Pawar, who also oversees the finance portfolio, during the Maharashtra legislature's monsoon session. This marks an improvement from the previous year's growth rate of 6.8 percent. The state's gross state domestic product (GSDP) at current prices for 2023-24 is projected at Rs 40,44,251 crore, while the real GSDP is estimated at Rs 24,10,898 crore. GSDP represents the total economic output generated within the state's boundaries over a specified period, typically a fiscal year.Maharashtra's average share in the all-India nominal GDP is the highest at 13.9 percent. The per capita state income for 2022-23 was Rs 2,52,389, an increase from Rs 2,19,573 in the previous fiscal year. The state's fiscal metrics include a fiscal deficit to GSDP ratio of 2.8 percent, a revenue deficit to GSDP ratio of 0.5 percent, and a debt stock to GSDP ratio of 17.6 percent.The total anticipated expenditure for annual schemes in the last financial year is Rs 2,31,651 crore, with Rs 20,188 crore allocated towards district annual schemes. These figures highlight the state's financial commitment to ongoing and future developmental projects.
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