SCI to invest $4b in fleet expansion over 5 years

KOLKATA: Shipping Corporation of India (SCI) has firmed up plans to invest close to $ 4 billion in acquiring 72 vessels over the next five years as part of an ambitious fleet acquisition plan.

SCI is already in the process of purchasing 12 vessels as part of the plan. “We have recently placed orders for 12 vessels. It will cost us about $ 1 billion. Orders for the rest of the 60 vessels will be placed in phases.

It will require a capex of about $ 3 billion,” S Hajara, chairman and managing director of SCI told reporters in Kolkata on Monday. He was speaking to reporters on the sidelines of a press conference to announce the formation of a committee to explore ways and means of harnessing the growth potential around Kolkata and eastern India.

According to Mr Hajara, the 12 vessels for which orders have been placed are scheduled to be delivered between 2008 and 2010. Rest of the vessels will be added to the fleet over the next five years. At present, SCI has a 79-vessels fleet. The company’s cash surplus, as per the balance sheet, stands at around Rs 2,500 crore. This, at least part of it, is expected to be put to use for the acquisitions.

The current capacity of SCI stands at 4.8 DWT. The company expects to increase it to at least 8 DWT once these acquisitions are complete. The 12 vessels ordered include two VLCCs (very large crude carrier), two container vessels and six crude carriers.

Meanwhile, SCI has decided to continue with its focus on eastern India in line with the look east policy of the Centre.Commenting on the proposed mega-dredging venture that will involve SCI, Kolkata Port Trust, Jawaharlal Nehru Port Trust and a few other entities, Mr Hajara said: “An international consultant would be appointed in the next three-to-four months through global tendering to form a PSU joint venture.”