Gujarat Ambuja Mulls Renaming Modi Cement
The management of Gujarat Ambuja Cement is considering renaming Modi Cement brand as Eastern Ambuja cement. This is being done to cash on the Ambuja brand enjoyed by the company.
Gujarat Ambuja recently acquired Modi Cement Ltd which has a 1.15 million tonne cement plant at Raipur in Madhya Pradesh. Modi Cement has a market share of 1.4 per cent in Madhya Pradesh.
According to Mumbai-based analysts tracking cement industry, selling the Modi brand under a Ambuja name would mean ready acceptance of the product.
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Gujarat Ambuja enjoys a good brand equity and enjoys 24.4 per cent market share in Gujarat, 50.75 per cent in Himachal Pradesh and 5.2 in Maharashtra. It does not have a presence in Madhya Pradesh. Gujarat Ambuja is currently making efforts to increase the capacity utilisation of the Raipur unit (belonging to erstwhile Modi Cement) from 80 to 100 per cent.
The company is investing Rs 60 crore in modernisation at the 1.2 million tonne (MT) plant and is improving the quality of cement.
Meanwhile, Harshavardhan Neotia has stepped down as the whole time director of Gujarat Ambuja Cement Ltd. However, he continues to be a director on the board of the company.
This comes in the wake of Neotias appointment as the managing director of Modi Cement which was recently acquired by Gujarat Ambuja Cement.
Subsequently, the number of whole time directors on the board of Gujarat Ambuja has declined from three to two.
According to company sources, Neotia will now be responsible for the day-to-day affairs at Modi Cement.
Industry sources, however, feel that the move could also be a step towards giving more powers to Pulkit Sekhsaria, son of Narotam Sekhsaria, who is a whole time director on the board. N Sekhsaria is the managing director of the company.
Neotia is also a whole time director on the board of another company in the group, Bengal Ambuja.
Bengal Ambuja had been floated by Gujarat Ambuja in association with the West Bengal government for setting up hotels.
However, financial institutions were dead against the company entering into real estate and subsequently, the project was abandoned.