India Cements share price jumped nearly 8% on Wednesday, 21 October, after reports highlighted the company's plan to acquire a 3.62% stake in Zenataris Renewable Energy to secure renewable power for its cement manufacturing operations.
The company has entered into an energy supply agreement and a share subscription agreement for an equity investment exceeding ₹20 crore. The transaction is expected to be completed within 120 days of the execution of the agreement, India Cements said in an exchange filing dated 15 October, updated on 16 October.
Hyderabad-based Zenataris Renewable Energy has been established as a special purpose vehicle (SPV) to develop and operate an inter-state transmission system (ISTS)-linked hybrid renewable energy project at Kudligi in Karnataka's Vijayanagara district.
Under the arrangement, the SPV will supply 11 MW of renewable energy to India Cements' cement plants under the group captive model. The investment is aimed at meeting the cement maker's captive power requirements, optimising energy costs and complying with regulatory requirements governing captive power consumption.
The share subscription and energy supply agreements provide the framework for India Cements' participation in the project and procurement of renewable power. The company has not disclosed additional financial details of the equity investment.