The dominant promoter group of Star Cement, a major player in the Northeast, is not interested in selling out despite a wave of consolidation sweeping across India’s cement sector with the Adani group and Kumar Mangalam Birla-led UltraTech competing with each other to pick up smaller cement players.
The family of Sajjan Bhajanka and Sanjay Agarwal, who collectively hold a 52 per cent stake in Star, have been approached by potential buyers offering to acquire their shares, sources said. However, the existing promoters have informed the interested parties ‘categorically’ that they would like to stay put.
“We are not interested in sale,” said Sajjan Bhajanka in a recent conversation with The Telegraph. Instead, the existing management and owners are looking to grow the business in the region, especially Assam, which fetches cement makers one of the highest prices in the country, Bhajanka insisted.
Star Cement came into focus early December with news doing the rounds that the Adani Group was evaluating a potential acquisition.
By the end of that month, it was UltraTech which snapped up a minority stake (8.42 per cent) for ₹776 crore from one of the Star Cement promoters, Rajendra Chamaria and family, stealing the march over Adani.
The Adani group had overnight become the number two player in the cement industry with the acquisition of Swiss major Holcim’s stake in ACC and Ambuja Cement in 2022 and then followed it up with a few more such as Penna Cement, Orient Cement and Sanghi Industries over the last two years.
Industry insiders with direct knowledge of the developments insisted Adanis were not keen to pick up only a minority stake without the visibility of acquiring a controlling stake. In contrast, UltraTech may have considered that a toehold in Star Cement would ward off potential competition in future, they added.
On January 16, the company received a notice to remove Rajendra Chamaria from the post of vice-chairman and MD of Star Cement. On January 27, Chamaria resigned from the post himself.
However, another faction of the Chamaria family continues to hold a minority stake in Star, even as Bhajanka and the Agarwal family — who are also partners and promoters of Century Plyboards, India’s largest seller of multi-use plywood and decorative veneers in the organised sector — remains firmly in control of affairs.
Growth plans
Speaking about the future, Bhajanka said Star Cement has well rounded plans to expand capacities, in mining, production of clinker and cement manufacturing. “We have just announced a ₹3,300 crore investment in Advantage Assam,” the chairman and managing director said.
The company plans to set up a new clinker plant for 3 million tonnes and a grinding unit in Umrangso, near the Assam-Meghalaya border. Moreover, it will set up another grinding unit at Jorhat.
It recently completed expansion at Guwahati, with capacity going up from 2 mt to 4 mt. It also commissioned a new clinker plant at Lumshnong (Meghalaya).
Star Cement has 7.7 mt grinding and 6.1 mt clinker capacity, including an unit at Siliguri in north Bengal. It has plans to take the cement capacity to 12 mt by 2027.
The capacity addition will be backed by raw material linkage, Bhajanka noted. Star was declared the preferred bidder for Boro Hundong limestone block in Dima Hasao district (formerly North Cachar Hills), Assam having an area of 400 hectares with estimated limestone resource of 146.75 mt.
