'Emami Cement takeover valuation may not exceed Rs 6000cr'

The valuation of Emami Cement which is up for sale may not exceed Rs 6,000 crore in the wake of stress in the economy and rising cost of finance, sources said.

The promoters of the city-headquartered company have been seeking to pare group-level debt and were targeting to raise between Rs 7000-8000 crore, according to reports.

Emami Cement had earlier sought a valuation of Rs 8,000-9,000 crore.

"There is stress in the economy with tighter conditions for credit. In this market situation, Rs 5,500-6000 crore is a realistic valuation," sources told PTI.

Though at least "four companies are effectively carrying out negotiations" with the Emami Group, only "one price bid had been submitted", they claimed.

Promoters of the group had earlier said they would become debt-free by February-March 2020, repaying about Rs 2,600 crore.

Aditya Birla flagship UltraTech, Nuvoco Vistas (formerly Nirma Cement), a LafargeHolcim company and Star Cement are in the race for taking over the 8-million tonne capacity cement business.

The Emami Cement has plants in West Bengal, Odhisa, Chhattisgarh and Bihar.

Analysts tracking this development said the group's 8 -million tonne capacity in the region which had shown steady growth in demand will "make a difference in valuation" for companies which want to consolidate their presence in this market.