Adani Ports plans container terminal in Dhamra

Company to expand the recently acquired Odisha port in phases in 2-3 years

With the Dhamra port on the east coast now in its kitty, Adani Ports & Special Economic Zone plans to raise capacity at the multi-cargo bulk handling facility, including building a container terminal there in two-three years, sources said.

On Friday, Adani Ports said it was buying out Dhamra Port in Odisha for an enterprise value of Rs 5,500 crore in an all-cash deal.

A source said the company wanted to add 12 berths at Dhamra, one of which could be a container terminal. The port has two bulk handling berths, with an installed capacity of 24 million tonnes.

“We have the required environmental approvals to add the 12 berths and so, to that extent we will be making the required investments in coming months,” Managing Director Sudipta Bhattacharya said. He, however, did not reveal the size of investment.

Buying the Odisha port was part of the company’s strategy to have a string of ports along the Indian coast and meet the target of raising capacity to 200 million tonnes by 2020, said Bhattacharya. In the year ended March, Adani Ports handled 112.75 million tonnes of cargo, including at its Australia port.

The source said, “The company will also remain focused on automation at the port to reduce turnaround time for shipments and so, will be making some investments towards that goal.”

Dhamra is an attractive acquisition for Adani Group, since the all-weather port with a deep draft allows even Capesize ships, the largest cargo ships weighing between 80,000 and 175,000 deadweight tonnes, to berth and is also close to the mineral-rich region in Odisha.

Adani Ports already operates ports at Dahej, Hazira and Mundra on the west coast in Gujarat and runs a coal loading terminal in Abbot Point in Queensland, Australia. The company has started operations in Mormugao, Visakhapatnam and Kandla ports.

“The expansion at Dhamra will happen in phases and the addition in number of berths will depend on the rise in cargo traffic,” said the source. “It has not been decided how many berths will be built in each phase.”

Dhamra Port was an equal joint venture between L&T Infrastructure Development Projects Ltd (IDPL), a subsidiary of L&T, and Tata Steel.

Larsen & Toubro had been looking to sell its stake in IDPL for over a year and talking to private equity investors and sovereign wealth funds. An L&T source said, “The management plans to use funds raised from the sale of the Dhamra port to invest in other infrastructure works.”

Dhamra port has an equity capital of Rs 2,100 crore and debt of Rs 3,400 crore, including Rs 800 crore of promoter debt, giving it a Rs 5,500-crore enterprise valuation.

STRING OF PORTS

* The Dhamra port in Odisha has two bulk handling berths, with an installed capacity of 24 million tonnes

* Adani Ports wants to add 12 berths at Dhamra, one of which could be a container terminal

* Buying the Odisha port is part of the company’s strategy to have a string of ports along the Indian coast and meet its target of raising capacity to 200 million tonnes by 2020