Ports operator JSW Infrastructure is working towards strengthening its logistics infrastructure through a network of inland container depots, container freight stations and rail terminals so that it can tie up with shipping lines and create a transhipment hub.
“We are working on that. Creating an asset is one part of the business and having a tie-up with liners is the most critical part. Setting up the logistics supply chain is a part of that,” CEO and MD Arun Maheshwari told businessline. The location had to be strategic, and the ecosystem had to be created. “Once we have one or two (shipping lines) on board, then probably we’ll get into the business of transhipments.”
On Friday, the company announced the acquisition of a slurry pipeline from group company JSW Utkal that will boost connectivity for its upcoming port at Jatadhar in Odisha. Earlier it said it was buying a majority stake in Navkar Corporation that owns three CFS, has a pan-India container train operator license as well as a fleet of railway rakes and ICD facility in Morbi, Gujarat.
“Unless we become a complete logistics supply chain provider, we will be servicing only one part of the business,” Maheshwari said on its thrust on logistics infrastructure. “Providing the last mile connectivity , being a logistics supplier, giving additional services to our customers increases the stickiness of the cargo. Last quarter it also won the bid under Gati Shakti scheme to develop a rail terminal at Arakkonam in Chennai, for which it has already secured an anchor customer.
The port operator is spending around Rs 30,000 crore to take it cargo handling capacity to 400 million ton by 2030. The investment on inland logistics infrastructure will be in addition to this. This will be done through a mix of acquisitions, strategic tie-ups with existing players as well as bidding for them.
The company handled close to 28 million tons cargo in Q1 of FY25, lower than estimated due to planned shutdown of JSW Steel’s Dolvi plant in the quarter, which affected cargo volumes at Jaigarh and Dharamtar. The shutdown, which was a planned maintenance manoeuvre, also affected JSW Infrastructure’s operating margins, but there would be an improvement in the current quarter, Maheshwari said.
The company has a robust pipeline that would add to volumes in future quarters. It has signed concession agreements for a liquid terminal at Jawaharlal Nehru Port, and at Tuticorin and construction on them has already started, he said. It is also expanding capacities at existing ports such as Jaigarh and Dharamtar.