Shipping Corp. to invest Rs 3,700 cr on 24 new vessels

The new ships exclude the 29 ships that are already under construction at various yards.

hidden September 23, 2011 23:07:11 IST
Shipping Corp. to invest Rs 3,700 cr on 24 new vessels

Mumbai: Shipping Corp. of India today said it would invest Rs 3,700 crore in the current fiscal to acquire 24 new vessels across categories.

"Our capital expenditure for 2011-12, is Rs 3,700 crore and this will be used for acquiring 24 vessels," Shipping Corporation of India (SCI) Finance Director B K Mandal told the company's 61st annual general meeting in Mumbai.

Shipping Corp to invest Rs 3700 cr on 24 new vessels

Investing more. Image courtesy SCI

The 24 ships will be equally spread across categories like bulk carriers, crude carriers, etc, in which, the company operates, he said.

The new ships exclude the 29 ships that are already under construction at various yards and the delivery of which is expected in the next four years, he added.

The average age profile of the shipping giant's vessels is 14 years at present, which will fall below 13 years once the new vessels are inducted, SCI Chairman S Hajara said.

Hajara also hinted at going slow on its plan to acquire minority stake in private shipyards, but stressed that the company has not reversed the decision.

In 2007, during the days of excess demand for ships, SCI was keen on buying into the private companies, which would have enabled it to get a preferential treatment in construction, he said, adding that the scenario has since changed for the worse.

"When your bottom lines are under pressure, I cannot say when the plan will be implemented," he said when a shareholder asked about the status of the acquisition plans.

Hajara also said he expects freight rates to improve going forward, but did not give any number on it.

At the same time, he doubted the profitability of entering the passenger ferry segment and said SCI, for now, does not have any plans of entering the inland passenger service business.

To prevent any piracy-related events against its ships, SCI is "seriously considering" to deploy armed guards on the vessels passing through troubled waters as per the permission given by the authorities recently, Hajara said.

PTI

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