Tata Martrade lines up Rs 300 cr for buyouts

Tata Martrade International, the joint venture between Tata Steel and Iq Martrade Holding of Germany, has chalked out aggressive growth plans for next five years by investing about Rs 300 crore on acquisition of berths, equipment and related hardware.

The company started off as a logistics management company for Tata Steel and is now clocking almost 100 per cent growth and actively wooing non-Tata Steel customers.

It has set a target of reaching Rs 1,000 crore topline by 2008-9, S C Saxena, managing director, said.

"Users will be happy to know that Tata Martrade will help them save $1.50-2 on each tonne of steel and $1 on every tonne of limestone or coal if they work through the company", he said.

Saxen said Tata Martrade prided itself on the globally comparable levels of efficiency thanks to the vision laid down by the company's board, which has Tata Steel MD B Muthuraman as its chairman.

Tata Martrade's expansion would mainly be financed by internal accruals combined with some borrowings. However, it was not in favour of raising debt.

Saxena disclosed Tata Martrade might even tap the market. "We were looking at all options, including an IPO to fund the expansion," Saxena said.

TMIL is engaged in port-related activities in Haldia, Paradip, Vishakhapatnam. It has taken over Berth 12 at Haldia. It is also developing a berth at Paradip on built-operate-transfer basis with investment of Rs 30-40 crore.

"Our focus is to get more aggressive in chartering business, forge alliance with international players for freight forwarding, port terminal management," the MD said.

At present, the Tata Steel contributes 82 per cent of the business. Tata Martrade aims to bring it down to 50 per cent over a period of time.

In the first five month of this year, port operations have shown a 12 per cent increase, chartering operation 65 per cent, while shipping and clearing 290 per cent (CIF value terms).

"We will looking at procuring a super Panamax vessel for break bulk and bulk cargo. We are exploring possibility of developing terminal and also acquiring equipment," he informed.

Tata Steel has an ambitious plan to expand capacity from the present five million tonne to 15 million tonne by 2010. As a consequence, Tata Martrade's business is going to expand by leaps and bounds.