DP World mulls acquisitions in bulk & liquid businesses

The company has earmarked $1 bn towards investment in India, employed in growing logistics sector

DP World, a pioneer in private container terminal in India, is evaluating acquisition opportunities in the bulk and liquid businesses, and is expected to make an announcement by December.

“Our teams are currently working towards a plan and we will look at all opportunities that are available,” Anil Singh, senior vice-president and managing director, Indian subcontinent, told Business Standard. 

The company has earmarked $1 billion towards investment in India, which will be employed in the growing logistics sector along with extended core businesses such as bulk and liquid. 

DP World handled close to 30 per cent of India’s container trade and also has the largest portfolio of investment in this segment. It has largely grown across ports in Gujarat, Maharashtra, Kerala, Tamil Nadu and Andhra Pradesh. It is also developing Kulpi facility in West Bengal. 

“We are aware that they (DP World) are in the market to evaluate bulk and liquid opportunities,” said an official in one Mumbai-based consultancy, but he did not divulge details.

Though DP World did not reveal their revenue figures for India business, the company said it has ambitious growth plans in bulk, liquid and logistics over the next two years through which it plans to scale up its revenues significantly.  

“This is the best time to make acquisitions since asset prices are low. For companies like ours which are financially strong, this is the best opportunity for us to grow inorganically and we will use this opportunity. We have already grown organically in the last 20 years but going ahead for a quantum leap, we need to go the inorganic way,” Singh said.

Industry officials were of the view, that DP World, in the past, has been less aggressive in its inorganic growth route plans in India.

Though DP World is looking to foray into the bulk and liquid ports business in the country, the company is not completely closed for any acquisitions in the container segment, where it still sees growth pockets despite not so strong capacity utilisation levels. 

“We have enough capacity in container division, but there are certain regions like Kolkata where there is scope for container business to grow, as there is a shortage. We are open to looking at such pockets as well,” said Singh.

Dubai-based DP World is part of its entire global operations that comprises regions such as Asia Pacific, Australia, America, West Asia, Europe and Africa. Container handling is the company’s core business and generates more than three quarters of its revenue. In 2016, DP World handled around 64 million TEU (twenty-foot equivalent units) across its entire portfolio.