Ramco Group Plans Big Restructuring to Attract Global Investors and Boost Cement Capacity

Tamil Nadu’s Ramco Group is restructuring its corporate ownership to simplify cross-holdings and attract foreign investors. This shift will eventually make Ramco Industries Ltd the main holding company for the group.

Key Steps in the Restructuring

As the first phase, The Ramco Cements has sold its 16.23% stake in Ramco Industries to promoter entities Rajapalayam Mills and Ramco Management. This change strengthens Ramco Industries’ hold over the group, with plans to make it the central holding company over the next few years.

Ramco Cements, with a production capacity of 25 million tons per annum (mtpa) and valued at ₹22,000 crore, is South India’s largest cement maker. The promoter family holds a significant 44% stake in the company, mostly through Ramco Industries and Rajapalayam Mills.

Future Restructuring and Capital Raising

The group plans to streamline holdings by merging or separating entities, subject to shareholder and regulatory approval. Ramco Cements, for instance, has been selling non-core assets to generate capital, with a target of ₹1,000 crore. Proceeds will help pay down debt, which stood at ₹5,026 crore in June 2024.

Ramco’s family and promoter entities, including Ramco Cements, Ramco Systems, Rajapalayam Mills, and others, currently hold shares in each other, creating complex cross-holdings. By removing these, the group will simplify its structure, making it easier to attract investors and enhance its brand reputation.

Capacity Expansion Amid Industry Competition

Ramco Cements is also boosting capacity to strengthen its market position as rivals Adani and Aditya Birla Group expand in South India. The company’s revenue for FY24 was ₹9,349.83 crore, and it plans to reach a capacity of 30 mtpa by March 2026, largely by optimizing existing plants and adding grinding units.

In the coming months, Ramco will sell more non-core assets, including land in Kurnool, valued at about ₹200 crore, and other real estate holdings. This capital will support the group’s efforts to restructure and increase cement production capacity.