DCI to Raise Money Via Tax-Free Bonds (India)
Dredging Corporation of India Limited will raise Rs.500 crore through public issue of tax-free bonds of face value of Rs.1,000 each, said its chairman and managing director D.K.Mohanty Friday.
India’s only dredging company in public sector is raising the money to acquire a dredger. It is one of the three dredgers being purchased by the company to replace the existing ones.
He said the company could generate another Rs.2,000 crore from the markets, considering a 2:1 debt equity potential, to fund its future expansion plans.
The company has already achieved financial closure for two other dredgers and one of them has even been installed. The second will be acquired in June this year while the third one is expected in January 2014. Each dredger costs Rs.550 crore.
After these three dredgers, the company plans to buy another two dredgers for Rs.1,200 crore. It is in talks with Visakhapatnam, Kandla and Paradip ports for loans to buy the dredgers.
P. V. Ramana Murthy, director, finance, DCI, hoped that the new dredgers would help the company increase productivity, thereby improving the margins.
DCI, which provides integrated dredging services to India’s major, non-major ports, shipyards and Indian Navy, had turnover of Rs.600 crore and profit of Rs.13 crore during 2012-13. It expects the profit to remain more or less same during 2013-14.
The Visakhapatnam-based Mini Ratna-category I public sector enterprise is the sixth largest dredging company. Sixty percent of the country’s dredging work are undertaken by the company, which had a networth of Rs.1,391 crore in December last year.
Establish in 1976, the company which is under administrative control of the ministry of shipping, removes silt from channels to make ports navigable.
With the country planning to triple the port capacity three billion tons per annum by 2020, DCI sees a larger role for itself in dredging works for new as well as existing ports.
Source: IANS, March 8, 2013