CSL establishing yard facilities in Kolkota and Mumbai
KOCHI: Cochin Shipyard Ltd (CSL), currently busy finalizing plans on the Rs1800 crore new dry dock facility in its I70-acre sprawling yard in Kochi and a Rs900 crore international ship repairing facility (ISRF) in the leased land in Cochin Port Trust (CPT), has set its eyes on new opportunities to be opened up by the country’s ambitious Inland Waterways system for the company’s next bout of revenue generation.
Touted to be the most efficient shipyard in the country, and testified by the Indian Navy through its bulk of orders and now eagerly waiting for the delivery of the largest aircraft carrier ever made in India, Cochin Shipyard had raised more than Rs1400 crore last year through an IPO, which was celebrated by the investors through the multi-fold oversubscription.
Despite being in one of the longest and the worst patches for the shipping industry world-wide, CSL could turn in a revenue of Rs2060 crore and a net profit of Rs312 crore for 2016-17 (the 17-18 results are still awaited). The persistent slow-down has broken the backs of many leading international players in ship building industry.
Talking to businessbenchmark.news, Madhu S Nair, CSL’s ‘home grown’ chairman and managing director (CMD) said CSL has moved ahead to establish new ship repairing and vessel building facilities in Kolkota and Mumbai at an approximate initial investment of Rs220 crore.
More importantly, CSL is in talks with the company that runs the river cruising service on Ganges (Ganga) to replicate a similar service in the river-rich Kerala from Kodungalloor to Kumarakam on the fabled Periyar that would always offer a minimum guarantee on water levels throughout the year unlike most rivers in Kerala.
“The talks are in a preliminary stage and hence I cannot reveal more details on names and numbers. But this project once materialized, would certainly drive more international tourists to Kerala,” said Nair.
Mentioning that the whole affair will be on a different level with an eye on affluent tourists from the West also, Madhu Nair said CSL’s main role will be to supply custom-built vessels measuring about 35 metres long, with 8 to 10 rooms and five-star facilities.
CSL has established a name for itself in the limited ship building and repairing space in India with a 20 per cent share in ship building and a market leadership by far in repairing with a share of 50 per cent and upwards
Briefing on the status on the Inland Waterways the country has embarked on, the CSL chief said India has already established three national waterways – NW1 that runs from Haldia to Allahabad – around 1600 kmts, and traversing through the populous states of West Bengal Jharkandh, Bihar and Uttar Pradesh; NW2 on Brahmaputra, and NW3 in Kerala connecting Kottapuram in Central Kerala to Kollam in north.
In order to cash in on these waterways and the business prospects they throw up, especially the two in north India, CSL has established a joint venture with Hoogly Ports and Dock Engineers (HDPE) in Kolkota – Hoogly Cochin Shipyard Ltd, with a view to bagging orders for vessels to sail on these waterways. “Though the requirement could run into hundreds, we would hope to start with an order book of 10 initially that can cater to the three waterways,” Madhu Nair said.
The new company has procured two parcels of lands used by the old shipyard facilities – 18 acres and 9 acres, from the Ministry of Shipping on a 60-year lease. While the investments to develop a new yard facility here is estimated to be in the region of Rs130 crore, Rs22 crore has already been chipped in towards the capital of the new venture.
In Kolkota, CSL has entered into an MoU with the old dry dock facility of Neta Subhas Dock (NSD) and the space has been taken by the company on a 30-year lease. Here, CSL is making an investment to the tune of Rs18 to Rs20 crore.
In Mumbai, the job for CSL would be easier as it has been able to take over the Hughes Dry Dock (HDD) from Mumbai Port Trust after signing an MOU for 30 years lease with them. “This is a much bigger facility and company intends to invest Rs80 crore here to take the action forward,” Madhu Nair added