Gujarat Pipavav Port is hopeful to maintain January-March operating margin of 46.5 percent in current quarter as well on the back of continuing high volumes, Prakash Tulsiani, MD, Gujarat Pipavav Port told CNBC-TV18 today.
“The company maintains the peak container volumes of Q4 2012 in this quarter also. In fact marginal increase from the previous quarter by about 5,000 TEUs (twenty foot equivalent unit),” Tulsiani said. He added that volumes from US were slowly picking up but Europe still remained subdued.
The company reported threefold jump in March quarter profit. Net profit rose to Rs 35.4 crore in Q1 from Rs 14 crore in the year ago period. Sales were up 24 percent on year at Rs 124.5 crore.
“Results are positively driven by better realisation, cost savings and operational efficiency. I expect the trend to be similar going forward,” Tulsiani said.
The shipping company is in process of spending Rs 11 billion to expand its present birth capacity. It plans to double container capacity by calendar year 2015 to 1.4 m TEUs and will also aims to hike bulk handling capacity to 10 million tonne.
Below is the verbatim transcript of the interview
Q: Let’s start by talking about your numbers at this point in time, margins at 46.5 percent – that’s quite strong will you be able to maintain it going forward?
A: In January-March 2013, our total income grew by 25 percent to Rs 125 crore. Our earnings before interest, tax, depreciation, and amortisation (EBITDA) is up by 29 percent at Rs 58 crore. Our margin is at 46.5 percent and net profit at Rs 35 crore versus Rs 14 crore in the previous quarter. As we see the total operating income is highest in any quarter so far. The company maintains the peak container volumes of Q4 2012 in this quarter also. In fact, there is a marginal increase from the previous quarter by about 5,000 TEUs. Net result at Rs 35 crore are inline with the previous quarter and two and half times the net result in the same quarter in the previous year. Results are positively driven by better realisation, cost savings and operational efficiency. I expect the trend to be similar going forward.
Q: How did the container volume pan out during the quarter, if you could shed some light on that as well?
A: Recent trend indicates that US markets are slowly picking up while Europe remains subdued. Overall in the Q1, India West Coast volumes have grown by 2.5 percent, while we have maintained the volumes of preceding peak quarter.
Q: Analysts expected bulk volumes to stay depressed what are you gauging on this front?
A: We are doing well with our fertilisers and agri products. However, coal volumes are impacted. This is because of rail freight differential. We are in constant dialogue with the stakeholders to address this rail freight differential.
Q: The other point which I just wanted to note for this quarter in particular. I do understand that there was a lot of addition in terms of new liners or some addition of new liners. How helpful has the same been towards volume growth?
A: In 2012, we have added five services. They are delivering the numbers as per the business plan which we have.