Why ITD Cementation Share Price is Rising

India's infrastructure industry is booming, driven by large-scale urbanisation, government-backed projects, and rising investments in transportation, construction, and housing.

With infrastructure at the core of economic development, companies that contribute to this sector have been key players in shaping the country's growth story.

ITD Cementation is one of the leading construction and civil engineering firms in India. It has a diverse portfolio that includes large-scale projects in marine structures, urban transport, highways, and hydroelectric plants.

Known for its expertise in delivering high-quality infrastructure solutions, the company has secured numerous government contracts and works on projects critical to the nation's progress.

Recently, ITD Cementation caught investors' attention when its share price surged 20% in a single day following a major news report.

Let's take a closer look at the news driving this surge and understand why ITD Cementation's share price is rising.

Big Acquisition Talks

Shares of ITD Cementation surged after news emerged that Adani Group is the top contender to acquire a 46.6% promoter stake in the company.

This potential acquisition, valued at Rs 58.9 billion (bn), includes a fully subscribed open offer that will follow the promoter stake purchase.

Adani Group is expanding its portfolio, which already covers airports, highways, ports, power plants, and real estate.

The deal aims to strengthen Adani's civil engineering capabilities, boosting its infrastructure operations. ITD Cementation, with a long history dating back to the UK, is a well-established engineering, procurement, and construction (EPC) company.

The promoter, Italian-Thai Development Public Co, holds a 46.6% stake in ITD Cementation. The company had earlier informed stock exchanges about the possibility of a promoter divestment, though no formal agreement had been reached at the time.

This potential acquisition, expected to be routed through Adani Enterprises, has driven up investor sentiment, leading to a significant rise in ITD Cementation's share price.

The news of a high-profile acquisition by a conglomerate like Adani boosts confidence in ITD Cementation's future growth, attracting investor interest and driving the stock price higher. ITD Cementation has already issued a clarification letter regarding the report.

The divestment process remains in its early stages, with no final decision made. Despite the buzz, there has been no official agreement or progress towards the sale at this time.

What Next?

Looking ahead, ITD Cementation has a strong pipeline of projects. The company achieved over Rs 2.3 billion (bn) in revenue in Q1 FY25, a significant increase compared to previous years. This progress highlights its ability to scale quickly and efficiently.

With an EBITDA of around 10% and profit after tax improving to 4.2%, ITD Cementation has shown consistent growth in key financial metrics.

Its prospects remain strong, especially with large projects like the Ganga Expressway, where 50-55% of the work has been completed. The company generated Rs 6 bn in revenue from this project alone in the last quarter.

The Chennai and Bangalore Metro projects are progressing steadily, and major marine projects like Udangudi and the East Coast Navy job, Project Varsha, are advancing well. Additionally, Seabird on the West Coast is nearing completion.

On the international front, the company's focus on expanding overseas is clear. Projects such as the West Container Terminal in Colombo are advancing smoothly, although the situation in Bangladesh remains uncertain due to political instability.

However, ITD Cementation has not incurred significant expenses on this project yet, and mobilisation will begin once the situation stabilises.

With tenders already submitted and more opportunities on the horizon, the company expects to maintain its current growth trajectory. Both domestic and international markets present ample opportunities.

How ITD Cementation Share Price has Performed Recently

In the past five days, ITD Cementation share price has rallied 15.7%. In the last month, it is up 3.2%.

In 2024, so far its share price rallied 95% and it went up 157.4% in the last year.

The stock touched its 52-week high of Rs 589.7 on 2 July 2024 and a 52-week low of Rs 188.2 on 26 October 2023.

About ITD Cementation

ITD Cementation is an India-based engineering and construction company. The company is involved in heavy civil, infrastructure, and engineering, procurement and construction (EPC) business and operates in India.

The company is engaged in marine structures, mass rapid transit systems, airports, hydroelectric power, tunnels, dams and irrigation, highways, bridges and flyovers, industrial buildings and structures, and foundation and specialist engineering.

Its subsidiaries include ITD Cementation Projects India Limited, ITD Cemindia JV and ITD Cem-Maytas Consortium.

For more details about the company, you can have a look at the ITD Cementation factsheet and ITD Cementation quarterly results on our website.

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Happy investing!

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