Fourth vessel to increase capacity by 10%: Shreyas Shipping

Shreyas Shipping, a container feeding company, has already added its newly bought vessel to its fleet, says company's CEO VK Singh. In March, the company had inked a memorandum of understanding (MoU) to buy one vessel. This new vessel will join its fleet on their weekly service. The company operates from the east coast of India to Vizag, covering all the four Indian ports. After this acquisition, Shreyas Shipping has six vessels on the east coast and three on the west coast, and the company doesn't have any plans of adding anymore vessels on the west coast in the near future. The four vessels from the east can handle the additional volume coming from the west coast if needed, he clarified.The new vessel will add 10 percent to the existing capacity. The total capacity right now is around 13,500 twenty-foot equivalent unit (TEU). The company ships containers from Indian ports to Dubai, Colombo, Singapore and Jebel Ali.  Below is the verbatim transcript of VK Singh's interview with Reema Tendulkar & Mangalam Maloo on CNBC-TV18. Reema: On March 16 you signed a memorandum of understanding (MoU) for an acquisition of one container vessel. Could you tell us what will be the benefit for the company on account of this and aren't we already sitting on very high capacity and supply? A: Yes that is right but we had already planned that. Our service had three vessels and we needed four vessels to make it weekly service. We have grown on our capacity utilisation, so there was a requirement for fourth vessel which after signing the MoU we have acquired the vessel and it has come in service. We have already put the ship on the service, which was earlier having three vessels, now it is operated by four vessels and that is right from Jebel Ali to east coast of India to Vizag, covering all the Indian ports. However, that was well planned and we are moving ahead as our strategy. Mangalam: In that case could you tell us what is the incremental revenue that is expected coming in from just this vessel and if you look at your mix, the company after this vessel acquisition has six vessels on the east coast while just three on the west coast, so any plans of adding a few more vessels on the west coast going forward? A: We do not have any plans as such because on west coast we are doing with two vessels but even these vessels which are going to the east coast from Mundra, they can always cater to the requirement. There is no requirement of west coast because they are also coming to Cochin and Tuticorin on the west coast, it starts from west coast and goes to east coast. So we can handle that additional volume if required for west coast also. So that suites us well because those four vessels which are going from west to east can carry the west coast cargo as well as east coast cargo and two vessels additionally which we have deployed on the east coast is basically just to do the fettering between Kolkata, Haldia and other smaller ports like Kakinada and Paradip into Vizag where we do the hubbing and we take the cargo. So that is where we have increased the capacity because the requirement has been increasing and now the service getting about almost six months older. However, the requirement also has been increasing and with the addition of the vessel yes, the revenue should go up because we have added almost 10 percent of additional capacity. Now we have 13,500 twenty-foot equivalent unit (TEU) total capacities with nine vessels and this vessel which we have added is 17,000 TEU, so that is where it is almost adding about 10-12 percent capacity overall in the fleet. So definitely we are looking forward for additional revenue on that ground because in any case we had a miss selling which we can do with this vessel which we have added.