The Hindu Business Line : `Consolidation likely in cement, telecom, power sectors'

CEMENT, telecom and power sectors are expected to witness a number of merger and acquisition deals in the near future. These sectors are in for further consolidation and will reach a mature stage with seven to eight large players in each sector, according to Mr Subrata Mukherji, Chief Executive Officer, ICICI Securities Ltd.

Following the recent acquisition of the cement business of L&T by Grasim and the existing understanding between Gujarat Ambuja and ACC, small players in the cement industry will find it difficult to survive in the long term.

While cement has a localised market, India's strength in setting up and managing cement units can be utilised in commissioning manufacturing units abroad, he said.

Mr Mukherji, who has taken over as CEO of I-Sec, expects the consolidation in various sectors to throw open more business opportunities for investment banks like I- Sec. He feels some sectors of the Indian industry would achieve higher growth in the coming years.

In sectors like auto/auto ancillary Indian companies are globally competitive and are poised to achieve larger share of the global market. He also expects high growth rate for Indian spinning, denim and terry towels units.

Though crude refining is going through a bad phase currently, with margins diminishing, exploration and production are expected to be profitable areas for the petroleum industry. The retail sector in the petroleum sector is also expected to grow rapidly over the next few years, he said.

ICICI Securities' business is expected to grow in all the three areas that it is currently engaged in, namely, corporate finance, equity broking and primary dealership in government securities, Mr Mukherji said. The corporate finance advisory services arm is currently involved in the divestment of public sector units - both in initial public offers and residual stake sales.

More Stories on : Trends | Mergers & Acquisitions

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page