Gangavaram Port Ltd, which operates the country's deepest-draft port located in Visakhapatnam, expects to achieve financial closure for its Rs 1,200-crore capacity expansion project by August-end this year.
Funds
The company, owned by the DVS Raju Group (59 per cent), private equity firm Warburg Pincus (30 per cent) and the Andhra Pradesh Government (11 per cent), will be raising Rs 900 crore for the expansion project, the rest to be mobilised through internal accruals. “We will be raising the debt through a mix of borrowings from the Indian market and the external commercial borrowings (ECB) route. We are not considering issue of bonds for this project,” Mr Pranav Choudhary, Chief Financial Officer, told Business Line .
Four berths
The expansion plan involves construction of four berths — one exclusively for coal and three multi-purpose berths — to enhance its cargo handling capacity from the current 25 million tonnes to 45 mt.
Last fiscal, the port handled about 14 mt of cargo, with the target for the current fiscal being between 16 mt and 17 mt. It expects to finalise the global EPC tenders for construction of the berths in the next couple of months, with the construction time estimated at 24 months from the zero date.
Although immediately not on the anvil, the port will look at getting into container and wet cargo, including crude, handling services later.
“Container traffic will surge in the years to come and we will definitely go into it. As of now, we have not finalised any plans,” Mr Choudhary said.
“We anticipate increased requirements of imported coal, which is why we have gone in for the mechanised coal berth that can handle vessels up to 200,000 DWT in the current expansion,” he said.
Navayuga project
Due to the same reason, its neighbouring Krishnapatnam port, developed and operated by the $5-billion Navayuga Group, is also hastening its Rs 4,000-crore phase-II development programme, besides proposing an additional investment of Rs 2,000 crore to further mechanise cargo handling operations.
The port, which has five multi-purpose berths with a draft of about 15 metres, handles a little over 16 million tonnes, as against the phase-I installed capacity of 25 mt.
phase II expansion
The phase-II expansion, which includes six dedicated coal berths, will be increasing its capacity to 45 mt.
This region is expected to see a greater rush of coal traffic, with a total of 14,000 MW of power projects coming up, including Reliance's 4,000 MW unit and AP Genco's 1,600 MW plant.
“These projects alone will require coal of over 60 mt per annum,” an official said.