The company, which earns a fifth of its revenue from offshore services, expects the boost as it plans to invest $300 million to buy vessels for offshore marine services and crude oil transportation.
The Mumbai-based company reported Rs 672.6 crore of revenue from operations in 2006-07, of which it earned around 55 per cent from LPG transportation and 25 per cent from crude oil and petro-products transportation. The remaining 20 per cent of the revenue came from offshore marine services.
"We will see the three sectors almost balancing with 30-33 per cent of revenues in the next three to four years," Yudhishthir Khatau, managing director, Varun Shipping Company. "With crude oil prices touching new highs, there is tremendous incentive for oil exploration companies to increase their exploration and production activity."
The company did not share an outlook on the total revenue growth of the company in the future years.Its revenue from operations grew by around 5 per cent in 2006-07 over the previous financial.
With 11 LPG carriers, Varun Shipping owns 80 per cent of the LPG tonnage in the country and has a market share of over 70 per cent of the LPG cargo.
"We plan to spend $300 million for buying new vessels in the crude oil transportation and offshore marine services space by the end of this financial year," said Khatau. The company plans to use internal accruals and raise debt for the new vessel purchases. It is looking for 3:1 to 4:1 debt-equity ratio for the funding.
Currently, it owns three crude oil tankers, one oil products tanker and five anchor handling and tug supply vessels (AHTS) used for offshore services.
The company's AHTS is used for deep-water exploration for clients such as public sector oil explorer Oil and Natural Gas Corporation and private sector explorer Reliance Industries.
The company believes that opportunity lies in deep water as most of the shallow-water fields are already explored.
