 "Coastal Shipping")
State-owned Shipping Corporation of India (SCI) has earmarked Rs 900 crore capex for the current financial year even as business climate remains grim for the industry across globe mainly because of availability of low-priced assets in the market.
"Demand for fleet is pathetic and so it is the right time to buy assets. We have purchased one offshore vessel recently and negotiations are on for another tanker vessel," B B Sinha, chairman and managing director of the company told reporters on Monday. He was speaking on the sideline of annual convention of Indo-American Chamber of Commerce held here.
The country's largest shipping company has reported disappointing results in the June quarter with revenues taking a sharp hit due to weak dry bulk business across globe.
"Dry bulk was already doing badly plus the tanker market also softened, which hit the topline," explained Sinha.
Going ahead, the company plans to focus on reducing its costs in order to protect its operating profits which has been taking a hit due to lower revenues.
"Controlling costs, deploying ships and diverting container vessels for coastal shipping are some of the steps Shipping Corporation is taking up in coming quarters," informed Sinha.
In the June quarter, the company reported a 73 per cent year-on-year drop in profit at Rs 56 crore due to lower revenues which declined 23 per cent from the corresponding period last year to Rs 840 crore.
Alongside, the company will also be setting up an inland waterways arm which will focus mainly on the eastern region of the country at present.
"Shipping Corporation will be providing the subsidiary with a loan of less than Rs 1 crore which can then utilise the funds to invest in inland waterways projects," said Sinha.
To begin with, the subsidiary will invest in small barages on the Varanasi-Kolkata route, he said.
