Looking to raise Rs 1,000 cr to repay debt: JSW Infra CEO B V J K Sharma

Says firm has lined up capex of Rs 7,000 cr as it looks to reach port capacity of 200 mtpa by 2020

JSW Infrastructure, one of the leading private port developers, is looking to raise Rs 1,000-1,500 crore to place private equity or strategic partners. It has lined up a capex of Rs 7,000 crore as it looks to reach a port capacity of 200 million tonnes per annum (mtpa) by 2020, besides foraying into container handling. B V J K Sharma, joint managing director & chief executive officer of JSW Infrastructure, shares the plans with Jayajit Dash. Edited excerpts:

JSW Infrastructure is looking to offload 15 per cent equity. Which private equity players or strategic investors are you talking to?

We are growing at a rapid speed and target to reach 200 mtpa cargo handling capacity by 2020 at our various ports from 70 mtpa. With this target, JSW Infrastructure is likely to first go for a private placement to the level of 10-15 per cent.

Can you elaborate on your upcoming investments in the port business?

The company is working to receive the Valemax, the largest-ever 400,000 tonnes iron ore carrier and also 350,000 tonnes very large crude carriers in the county. It has planned a capital expenditure of Rs 7,000 crore in its various ports over the next three years. JSW Infrastructure has invested Rs 2,000 crore in JSW Jaigarh Port and plans to spend additional Rs 2,000 crore in it. Besides Jaigarh and Dharamtar port in Maharashtra and South West Port in Goa, the company is developing iron ore and coal export terminals at Paradip Port in Odisha, in a PPP (purchasing power parity) model, with a capacity of 48 million tonnes per annum.

JSW Infrastructure has plans to set up a greenfield port in the UAE. By when is the port expected to come up? What is the estimated investment and facilities proposed?

We have recently forayed into our first foreign venture through a pact with Port of Fujairah (UAE) for the management of mechanised bulk cargo handling terminals. They have selected JSW Infrastructure due to our expertise in port operations and management. Fujairah Port is one of the largest deep draft, all weather ports and handles about 100 mtpa, which is poised to increase to 150 mtpa in the next two years. It seamlessly handles a variety of cargoes such as dry and liquid bulk, crude oil, break bulk and containers. At this port, container terminals are managed by DP World, and henceforth JSW Infrastructure will manage mechanised bulk cargo terminals and enhance the port’s efficiency and throughput and reduce operating cost.

What opportunities are you eyeing at the mega crude refinery planned by oil marketing companies — Indian Oil Corporation, Bharat Petroleum Corp and Hindustan Petroleum Corp in Maharashtra?

JSW Jaigarh Port currently handles dry and liquid bulk cargo but has plans to enter container handling. The company is eyeing opportunities at the proposed refinery by the oil giants in the Konkan coast of Maharashtra as Jaigarh port would be equipped to handle crude for the refineries. We are developing berthing facilities for dry bulk carriers, LNG carriers, largest container vessels and very large crude oil containers. Jaigarh Port can function as a captive port to handle very large crude oil-carrying ships and also export refined petroleum products. We have also tied up with Hiranandani Group, which is investing around Rs 4,000 crore to construct an LNG terminal at Jaigarh port.

JSW Infrastructure has planned to go for an IPO (initial public offer) by 2020. How much do you expect to mop up from the issue?

After private placement, the company would come up with an IPO around 2019 when the ports are likely to reach to 100-mtpa capacity. The target is to reach 200-mtpa cargo handling capacity by 2020.

As of now, what is the company’s debt load? What options are you considering to de-leverage?

JSW Infrastructure's current debt on books is Rs 1,600 crore. It is looking to raise about Rs 1,000-1,500 crore to place private equity or strategic partners. The funds will be used to expand operations and partly to pay off debt. The firm is likely to post an EBITDA (earnings before interest, taxes, depreciation and amortisation) at Rs 650 crore in FY17 against Rs 500 crore in FY16.