The firm’s India Equity Fund parted with more than 561,000 shares at INR3,800 ($68.83) each according to the Bombay Stock Exchange, which said the transaction was made through a bulk deal.
Shree Cement is the fourth-largest cement company in India and the largest manufacturer and seller in the north region.
Nalanda, which was launched in May 2007, says its LPs are primarily US endowments and foundations, US and European family offices.
In June it emerged global buyout giants Blackstone and KKR were thought to be in talks to buy a large stake in the cement division of the Shriram Group, a diversified $9bn conglomerate based in southern India.
Shriram EPC, which earlier this year bought a 70 per cent stake in indebted Indian rival Jayajothi Cements, is looking to raise more than INR4bn ($70m) to finance operations.
US-based Mount Kellett was also understood to have held talks with Shriram over a potential investment, although it was not clear whether the firm would pursue a deal.
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