Adani owned Dhamra port breaks even after six years, posts Rs 180 cr profit

Revenues driven by stellar cargo volumes in FY17, overall cargo handling up 47% to 21 mn tonnes

Dhamra, a deep-draught port off the coast of north Odisha owned by Adani Ports & Special Economic Zone (APSEZ) has turned profitable after nearly six years. The port had kicked off commercial operations in May 2011.

A senior Odisha government official said, the port has achieved break even with a profit of Rs 180 crore in 2016-17. Dhamra port’s total earnings crossed Rs 900 crore in the last financial year with the port paying Rs 75 crore as revenue share to the state government. A concession agreement signed with Dhamra Port Company Ltd (DPCL), the special purpose vehicle (SPV) formed for port operations, says the state government is entitled to eight per cent of revenue share after the port completes five years in commercial operations.

Revenues for the Dhamra port were driven by stellar cargo volumes in 2016-17, when its overall cargo handling moved up 47 per cent to 21 million tonnes (mt) from 14.7 mt in the year-ago financial year. The spike in cargo volumes was led by commodities like coal and iron ore.

Officials of DPCL did not comment on the port’s performance or its financials. An e-mail questionnaire remained unanswered.

In terms of cargo growth, Dhamra is believed to have bettered all ports run by APSEZ. On the same parameter, the port outpaced all major ports excepting Mormugao in last financial year.

Going ahead, Dhamra port has an ambitious plan to ramp up cargo handling capacity to 300 mt per annum. DPCL has sought permission from the Union ministry of environment, forest & climate change to expand capacity. The larger plan, here is to scale up the Dhamra port to bring it at par with APSEZ’s flagship port operations at Mundra. The port is also expecting to launch container handling business in six months to take on competition from major ports like Kolkata and also Paradip which is going to launch container operations.

Reaching a cargo volume of 300 mt is a long-term vision and may take 2030 or beyond to realise. This master plan envisages 35 berths compared to 14 approved in the original plan. The massive expansion needs significant land. Hence, DPCL authorities have decided to reclaim 2000 acres of land after obtaining approval. DPCL, meanwhile, has already received advance possession of 686 acres of land from the Odisha government to go ahead with its second phase expansion.

In the second phase, DPCL is raising cargo capacity to 100 mtpa to diversify to liquid cargo and containers. This phase expansion needs Rs 10,000 crore. In this phase, the proposed LNG terminal costing Rs 6,000 crore, is also expected to be commissioned. The port is gearing up to start construction activity on the LNG terminal proposed to be built at a cost of Rs 6,000 crore. Apart from Adani Enterprises, Indian Oil and GAIL would have stakes in the project.