Financial Daily from THE HINDU group of publications
Friday, Aug 16, 2002
India Steamship scouting for LPG-ammonia carrier
KOLKATA, Aug. 15
INDIA Steamship Co Ltd (ISS), a shipping company belonging to the K.K. Birla group, is planning to acquire a specialised LPG-ammonia carrier as part of its strategy to develop new business through greater integration with the activities of associate companies in the group.
ISS is targeting a second-hand vessel of the capacity of 25,000 dwt estimated to cost between $12 and 15 million.
"We are already in the market in search of a suitable vessel," a spokesman for the company told Business Line, pointing out that at least 20 per cent of the cost of the vessel had to be contributed by ISS promoters initially. "We are in touch with other companies in the group for the purpose," he said.
The sale proceeds of the two vessels Ratna Deep, a bulk carrier, and Indian Goodwill, a break-bulk vessel would help raise some funds, he added. While Indian Goodwill has already been sold for scrapping, Ratna Deep is due for sale in the current financial year.
On acquisition, the LPG-ammonia carrier will be deployed for transporting both ammonia and phosphoric acid for the fertiliser companies in the group, namely Paradeep Phosphates (PPL), the Orissa-based phosphatic fertiliser company which till recently was a public sector company, and Goa-based Zuari Industries Ltd. In other words, Paradip and Mormugao are likely to be the unloading ports for the vessel.
PPL and Zuari, each importing about 300,000 tonnes of ammonia every year, can thus, provide captive cargo support to the vessel.
Right now, ISS is left with only one vessel, Ratna Abha, a tanker currently deployed on the US-Caribbean sector. The vessel, though more than 19 years old, was upgraded to meet some specific requirements of the oil majors and accordingly received acceptance of two oil majors, Shell International Trading Company, London, and Statoil, Norway. Further upgradation is planned this year when she will be put through a vigorous Condition Assessment Plan to ensure that the latest international standards of safety are complied with.
Top brass shake-up: Meanwhile, there has been a top-level shake-up in ISS. Mr L.M.S. Rajwar, the Managing Director, has quit following completion of his term. Mr Rajwar joined the company in 1990. Mr Ashok Kak has taken over as the Managing Director and Mr K.K. Palit as the Executive Director.
Mr Kak has to his credit multi-discipline/multi-functional assignments in such diverse companies as Esso/Hindustan Petroleum Corporation, Associated Cement and Eastman Kodak. Mr Palit recently retired as the Director (Technical and Offshore Services Division) of the Shipping Corporation of India.
Mr S.K. Poddar and Ms Sobhana Bhartia resigned from the board last year.
During the year ended March 31, 2002, ISS suffered a net loss of Rs 7.75 crore as against a net profit of Rs 1.53 crore in the previous year. The board of directors, therefore, abstained from declaring dividend.
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