Titagarh Wagons has started construction on ships for the Indian Navy and National Institute of Ocean Technology.
Sharing more details of the shipbuilding business, JP Chowdhary, Founder & Executive Chairman, Titagarh Wagons said they have received an order for four ships -- two for Navy and two for National Institute of Ocean Technology (NIOT), which are specialised types of vessels. The one that is being built for Navy is a supply vessel, for oil supply to Vikramaditya and NIOT are research ships, he said in an interview to CNBC-TV18.
The capex spent as of now to build these ships has been around Rs 60-70 crore. "We also have a lot of common facilities which are used of wagons, so the total capex will depend on the size of the project taken up," he said, adding “We will keep on expanding as we build up capacity and orderbook on this."
The navy order will take about 12-14 months to build for each vessel but both will be made simultaneously. The NIOT vessels will require 20-24 months.
Margins for these projects will depend on efficiencies because they are highly capital and technology intensive. Since these orders have been won as competitive tenders, the margins will be reasonable and cannot be runaway margins, said Chowdhary.
Shipbuilding would be an important vertical of Titagarh unit in Kolkata.
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