Gangavaram port hopes to break even in 3 yrs

Gangavaram Port Limited (GPL), stated to be the deepest port in the country with a depth of 21 metre, is expecting to achieve break-even in the next 2-3 years, according to chief financial officer Pranav Choudhary.

The Rs 1,700-crore Phase I of the port on the east coast near Visakhapatnam commenced commercial operations in April 2009. It had achieved cash break-even in 2010-11 with a turnover of about Rs 250 crore.

GPL is a special purpose company promoted in a public-private partnership mode by D Venkata Satyanarayana Raju, founder chairman of Hyderabad-based IT services firm VisualSoft Technologies Limited.

While Raju holds 59.7 per cent stake in GPL, the state government has a stake of 10.3 per cent. Private equity firm Warburg Pincus, which has invested about Rs 150 crore, holds the remaining 30 per cent stake.

The port, which is capable of receiving Capesize vessels (largest dry bulk cargo vessels of the size of 200,000 DWT) had handled 27 million tonnes (mt) of cargo till March 2011 including coal, project cargo, limestone, iron ore, steel, blast furnace slag and fertilisers.

Choudhary told Business Standard that the port had now embarked upon a Rs 1,200-crore expansion plan that was scheduled to be completed in the next two years.

To be funded through a debt of Rs 950 crore and internal accruals of Rs 250 crore, the expansion programme involves setting up four additional berths including a dedicated berth for handling of coal and three multipurpose berths.

Following the expansion programme, Choudhary said, the handling capacity of the port would increase from the existing 17 mt to 45 mt per annum.

"We will start the work in the next three months," Choudhary said, adding the overall infrastructure of the port would also be strengthened by installing state-of-the-art mechanised bulk material handling equipment, additional rail sidings and undertaking ancillary civil works.

He said GPL was also developing a green belt in an area of 240 acres with 60,000 plants and had established an in-house nursery for raising 100,000 saplings annually.