The age of private railways may have all but vanished with the Raj. But the Central Provinces Railways Company (CPRC), the country’s only listed operational railway company, survives – and as a curious relic from another era.
Incorporated in 1910, the company has declared no income since 2002, but trades at around Rs 65 on the BSE. It has four directors on its board, but no employees.
And it owns a 190-km narrow gauge railway line in Maharashtra, on which the Shakuntala Express connects a string of villages in Maharashtra’s Vidarbha region – a train the Central Railways is not interested in operating. The CPRC is entitled to 55 per cent of the passenger revenue on this line under a contract with Central Railways. If the company has declared a zero income for over a decade, it is because the Central Railways has adjusted its entire revenue share of Rs 2.10 crore (as of December 2012) against a capital expenditure of Rs 18.72 crore incurred for renewal, repairs and replacement of assets.
The company disowns the liability, on the ground that the Central Railways is contracted to make such replacements. But it chooses not to declare income to protect shareholder interests. As a result, the company books losses each quarter; for the one ending December 2012, it amounted to Rs 43,000.
OPERATIONS CONTRACT
The 100-plus-year-old rail company is owned by Killick Nixon Ltd, which started out as a partnership firm that floated as many as 10 railway companies.
The CPRC rail line was laid in the early 1900s, primarily to transport cotton to Manchester and traverses from Murtajapur to Achalpur and Yavatmal.
Central Railway General Manager Subodh Jain says the operations contract with Central Provinces Railway Company stipulates that the former should not spend more than Rs 10,000 on renewal or repair without the company’s approval and funding.
But that it had no option but to repair bridges that had collapsed during floods and undertake other related jobs to maintain the track.
Since, the CPRC had not provided the funds, the CR was simply deducting the same. He adds that CR is not interested in running the daily train service and that it does so only because once the railways provide such a service, it cannot be closed down without the consent of the State Government concerned. However, the contract gives CR an option to buy the line at 10-year intervals.
The next opportunity will come in 2016 for a sum totalling 120 months of earnings (or about Rs 5 crore). Asked about the company’s plans, a director of the Killick Nixon group said it all depends on what the Central Railway wants to do with the line.
The Government holds a 2.48 per cent stake in the company and is part of the promoter group which holds 6.59 per cent. LIC has 14.97 per cent in it.
Doubts about the viability of the company’s line, which depended critically on transporting cotton to England, remain.
But of late, there is a reviving interest in the narrow gauge section, reflected in the response the Central Railway has received for the spruced up Neral-Matheran line.
Matheran is a hill station, near Mumbai.