Week ending July 22, 2001


News on Ports

East coast ports of Haldia and Paradip have shown impressive surge in traffic during the first quarter of the current fiscal. Haldia Dock Complex (HDC) has registered a throughput of 5.78 million tonnes between April to June this fiscal as against 5.18 million tonnes in the coresponding period of the last fiscal. On the other hand, Paradip port has handled around 5.0 million tonnes of cargo during the same period as compared to 4.6 million tonnes. While HDC has recorded steady growth in crude, fertilizer, iron ore traffic, Paradip registered massive growth in fertilizer raw material and iron ore throughput.

Steel major, Tata Iron and Steel Company (Tata Steel) has planned to develop a berth at the Haldia Dock with Martrade of Germany for captive usage. The proposed berth to be developed at an estimated cost of Rs. 350 million is likely to handle 3.0 million tonnes of cargo per annum for import - export requirement of the company.

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News on Shippings

Shipping Corporation of India (SCI), country's shipping major, has registered a massive 488 per cent increase in net profit at Rs. 1.11 billion for the Q1 of the current fiscal as against Rs. 190 million for the corresponding period of the last fiscal. Earning from net sales has rose by 29 per cent to at Rs. 7.92 billion during the Q1 as against Rs. 6.13 billion. Owing to the increased income, the Board of Directors of SCI has recommended a final dividend of 5 per cent taking the total to 30 per cent for the last fiscal ended March 31, 2001.

Meanwhile, SCI is contemplating a proposal to place order for two new Suezmax type crude tankers having a capacity of 140,000 dwt each. As per the proposal, which is expected to be considered by Public Investment Board (PIB), each tanker would cost around USD50 million and would be funded by ECB (External Commercial Borrowings) and internal accruals in a 70:30 ratio. The proposed addition of these two tankers would be in addition to its fleet expansion programme of eight tankers, two bulk carriers and three cellular vessels, planned for the current fiscal.

India Steamship Company Limited, the K.K. Birla group company, is planning to replace its ageing bulk carrier fleet by younger vessels. With the infusion of Rs. 210 million through preferential allotment of shares for the one time settlement of its debts and expected fall in second hand bulk carrier prices, India Steamship is confident to replace its three bulk carriers in phases.

Promoters of Varun Shipping would hike their stake in the company by 9 per cent to 54 per cent through Concord Holdings Private Limited, a company belonging to the promoter group. The hike in stake would be made through the proposed issue of 3.62 million optionally full convertible warrants (OFCW) to Concord Holdings. Each OFCW would eventually be converted into one equity share of Rs. 10 each at a permium of Rs. 3.70 per share on a preferential basis.

Japan-based Mitsui OSK Line, the lead promoter of the Greenfield Holding Company Limited, is contemplating to deploy Dabhol Power Company's (DPC) USD220 million LNG carrier 'LNG Laxmi' in the international spot market due to delays in completion of the project. Owing to the unwarranted delay, 'LNG Laxmi' could be used for chartering LNG to other countries from West Asia. Mitsui has started to give more attention on the future trading aspects of LNG as considerable demand for such vessels exists in the current market. It can be noted that Greenfield Holding Company Limited, a joint venture of Mitsui OSK Line holding 60 percent stake with Enron India and Shipping Corporation of India holding 20 per cent stake each, has signed 20 year f.o.b agreement with DPC for the supply of LNG to its USD800 million LNG terminal at Dabhol at a daily charter hire of USD98,000.

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News on Shipbuilding

National Ship Design and Research Centre (NSDRC), the autonomous body under the Ministry of Shipping, is contemplating to make an entry in the new areas of operation owing to the declining trends in the domestic ship design market. NSDRC has identified maritime education, IT development, electronics and communication, port infrastructure and environmental engineering services as the new areas of operations for its long awaited expansion programme.

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News on Logistics

The Union Government has started work on the Rs. 40 billion port connectivity project, which aims to connect all the major ports of the country to the nearest highway to facilitate easy cargo evacuation. Work has already commenced at Kandla and Mormugao ports, while contracts for linking Haldia, Visakhapatnam, JNPT to nearest highways is likely to be awarded in the next few months.

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