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Thursday, 05 November 09
MERCATOR LINES AIMS TO BECOME A $5 BILLION COMPANY
 Mercator Lines, India’s second largest private sector shipping line, plans to invest and expand, riding India’s next wave of growth, the theme of the World Economic Forum’s India Economic Summit, to be held in New Delhi on 8-10 November
It all started with an idea floated by a co-passenger in a flight.
Harish K. Mittal, owner of India’s second largest private shipping line, does not remember the passenger’s name, but his suggestion on starting a shipping firm way back in the early 1980s stuck in his mind.
Mittal, then running a chemical factory in Muzaffarnagar in Uttar Pradesh, mentioned this idea to Atul Agarwal, who is married to his wife’s sister. Agarwal was at the time auditing some companies that included a few shipping firms.
In 1988, Agarwal mentioned that Mumbai-based Mercator Lines Ltd was on the block. Mittal, then also into the business of buying ship scrap, did not hesitate. He bought the firm for Rs1.2 crore from the Ramchandani family.
From Rs65 lakh in 1988, the firm’s revenue increased to Rs2,200 crore in the year ended 31 March. Mercator Lines today runs a fleet of 28 vessels, up from three barges in the year Mittal bought the firm.
The shipping line, riding high on the wave of India’s economic liberalization since the 1990s, listed on the Bombay Stock Exchange in 1993 and has never missed paying a a yearly dividend to shareholders, Mittal says.
The 59-year-old entrepreneur now wants to make his firm a $5 billion (around Rs23,550 crore) company, an “ambitious dream,” but not impossible for a shipping line that reported a revenue of just Rs60 crore just five years ago.
From a traditional tanker company, Mercator today has a presence in bulk shipping, tanker shipping, dredging, offshore oil exploration and coal mines.
“We have already acquired four coal mines in Indonesia and one in Mozambique. We are now looking for acquiring one more in Indonesia. This will enable us to offer a complete logistics package including coal, ship and local logistics,” says Mittal, who holds a 1973 postgraduate degree in technology from the Indian Institute of Technology, Roorkee, then known as the University of Roorkee.
A majority of new Indian power projects are eyeing imported coal, mainly from Indonesia, to run their plants.
Mittal attributes his success to his management team.
An analyst agrees. “Mercator Lines management was always aggressive to grab every opportunity that came before them, be it dredging, coal mines, offshore or dry bulk ships,” says Kapil Yadav, an analyst with domestic brokerage Dolat Capital Market Pvt. Ltd. Yadav tracks the firm’s scrip.
“The business model of Mercator Lines is to diversify to several segments to derisk, while locking in its vessels for long-term contracts to mitigate the volatility of freight rates,” he says.
Mercator Lines has acquired four dredgers and plans to add six more to its portfolio. Indian ports continuously require dredging to keep their shipping channels deep. State-run Dredging Corp. of India Ltd is unable to meet the entire requirements of the country’s ports. Some international dredging companies have set up shop in India to tap the market potential.
“We are very serious about dredging,” says Mittal. “Apart from dredging, we are also upbeat about the offshore sector.”
Mercator Lines, as part of a strategy to derisk the cyclical nature of its core shipping business, entered the offshore drilling business with the delivery of a Rs1,000 crore jack-up rig. The rig was immediately deployed on a three-year contract with state-owned Oil and Natural Gas Corp. Ltd through Great Eastern Shipping Co. Ltd.
“We are constantly looking for other areas of offshore business, exclusive offshore support vessels. This could be anything, high specification rigs or other areas,” Mittal says. “Mercator was contracted two oil blocks under the seventh round of the new exploration licensing policy,” Mittal said.
In December 2007, Mercator Lines listed its Singapore-based subsidiary on the Singapore Stock Exchange and raised over Rs500 crore.
Last year, shipping firms were hit by the global economic downturn that led to a steep decline in world trade and caused freight rates to fall. “Though there are some signs of revival, I think the next two years are going to be tough for the shipping sector,” Mittal says. “Our diversification model is going to save us during this crisis.”
“Though Mercator has done everything to de-risk by diversifying, as a shipping company it will be exposed to volatility since it is a cyclical industry,” Dolat’s Yadav says.
Mittal, however, remains optimistic. He says all the business segments of his firm are growing and he would continue to invest in these. “Nothing stops us from aiming at being a $5 billion company.”
Source: Live Mint
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Thursday, 12 November 09
GANGAVARAM PORT SETS RECORD BY DISCHARGING 80,514 TONNE OF COAL CARGO
Gangavaram Port, the deepest port in the country with water depth of 20 meters, has achieved an unprecedented milestone by discharging 80,514 metric ...
Thursday, 12 November 09
FOREIGN INVESTMENT IN RUSSIAN COAL SECTOR
Reuters reported that, Russia's coal mines, particularly in the Arctic and Far East, are attracting interest from foreign investors as commodity pr ...
Thursday, 12 November 09
BANPU TO INVEST US$ 466 M
Plan targets 33.5m tonnes of coal per year
Bangkok Post reported that, Banpu Plc, Asean's largest coal miner, is planning capital investments of ...
Wednesday, 11 November 09
NORTHSTAR TAKES 40 PER CENT OF INDONESIAN MINING COMPANY
AltAssets reported that, PT Northstar Pacific Partners, the Indonesian affiliate of US private equity firm TPG, has taken a 40 per cent stake in Ind ...
Wednesday, 11 November 09
INDONESIAN COAL MINERS SOLD BIG VOLUMES OF 2010 TO CHINA
* China has scooped up large volumes of Indonesian coal
* Total exports to China in 2010 seen to exceed 20 million T
* Chinese, Indian demand may ...
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- Sakthi Sugars Limited - India
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- Minerals Council of Australia
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- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Makarim & Taira - Indonesia
- Parry Sugars Refinery, India
- Kobexindo Tractors - Indoneisa
- Alfred C Toepfer International GmbH - Germany
- Rio Tinto Coal - Australia
- India Bulls Power Limited - India
- Altura Mining Limited, Indonesia
- GVK Power & Infra Limited - India
- Bukit Baiduri Energy - Indonesia
- The University of Queensland
- McConnell Dowell - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- IEA Clean Coal Centre - UK
- Global Coal Blending Company Limited - Australia
- Intertek Mineral Services - Indonesia
- Interocean Group of Companies - India
- Renaissance Capital - South Africa
- Grasim Industreis Ltd - India
- Banpu Public Company Limited - Thailand
- Krishnapatnam Port Company Ltd. - India
- Singapore Mercantile Exchange
- Ministry of Mines - Canada
- Indogreen Group - Indonesia
- Sree Jayajothi Cements Limited - India
- Ministry of Transport, Egypt
- The Treasury - Australian Government
- Mintek Dendrill Indonesia
- Electricity Generating Authority of Thailand
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- Kumho Petrochemical, South Korea
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- Metalloyd Limited - United Kingdom
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Kaltim Prima Coal - Indonesia
- European Bulk Services B.V. - Netherlands
- Straits Asia Resources Limited - Singapore
- Meralco Power Generation, Philippines
- Cement Manufacturers Association - India
- Mjunction Services Limited - India
- Tata Chemicals Ltd - India
- Asmin Koalindo Tuhup - Indonesia
- Port Waratah Coal Services - Australia
- Ambuja Cements Ltd - India
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- TeaM Sual Corporation - Philippines
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- Indika Energy - Indonesia
- Sojitz Corporation - Japan
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Eastern Coal Council - USA
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- ICICI Bank Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Borneo Indobara - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Salva Resources Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Latin American Coal - Colombia
- Sindya Power Generating Company Private Ltd
- Indo Tambangraya Megah - Indonesia
- Coastal Gujarat Power Limited - India
- Sarangani Energy Corporation, Philippines
- Larsen & Toubro Limited - India
- Star Paper Mills Limited - India
- Coal and Oil Company - UAE
- Coalindo Energy - Indonesia
- Bhushan Steel Limited - India
- Deloitte Consulting - India
- New Zealand Coal & Carbon
- Aboitiz Power Corporation - Philippines
- Malabar Cements Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Gujarat Electricity Regulatory Commission - India
- Ceylon Electricity Board - Sri Lanka
- Siam City Cement PLC, Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bangladesh Power Developement Board
- Marubeni Corporation - India
- Ind-Barath Power Infra Limited - India
- Vedanta Resources Plc - India
- Leighton Contractors Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Jaiprakash Power Ventures ltd
- Central Java Power - Indonesia
- Formosa Plastics Group - Taiwan
- Uttam Galva Steels Limited - India
- Globalindo Alam Lestari - Indonesia
- Energy Link Ltd, New Zealand
- Mercuria Energy - Indonesia
- Chettinad Cement Corporation Ltd - India
- Indonesian Coal Mining Association
- Karaikal Port Pvt Ltd - India
- London Commodity Brokers - England
- Aditya Birla Group - India
- Samtan Co., Ltd - South Korea
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- PetroVietnam Power Coal Import and Supply Company
- Bulk Trading Sa - Switzerland
- ASAPP Information Group - India
- Electricity Authority, New Zealand
- Eastern Energy - Thailand
- Barasentosa Lestari - Indonesia
- Manunggal Multi Energi - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- San Jose City I Power Corp, Philippines
- CIMB Investment Bank - Malaysia
- Planning Commission, India
- Maharashtra Electricity Regulatory Commission - India
- Mercator Lines Limited - India
- Wilmar Investment Holdings
- Chamber of Mines of South Africa
- Cigading International Bulk Terminal - Indonesia
- Central Electricity Authority - India
- Tamil Nadu electricity Board
- Lanco Infratech Ltd - India
- GAC Shipping (India) Pvt Ltd
- Africa Commodities Group - South Africa
- Parliament of New Zealand
- Agrawal Coal Company - India
- Sical Logistics Limited - India
- Maheswari Brothers Coal Limited - India
- Merrill Lynch Commodities Europe
- Toyota Tsusho Corporation, Japan
- Directorate Of Revenue Intelligence - India
- TNB Fuel Sdn Bhd - Malaysia
- PTC India Limited - India
- Meenaskhi Energy Private Limited - India
- Economic Council, Georgia
- Georgia Ports Authority, United States
- VISA Power Limited - India
- Romanian Commodities Exchange
- Price Waterhouse Coopers - Russia
- Heidelberg Cement - Germany
- Holcim Trading Pte Ltd - Singapore
- Power Finance Corporation Ltd., India
- Bahari Cakrawala Sebuku - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Semirara Mining Corp, Philippines
- Edison Trading Spa - Italy
- Miang Besar Coal Terminal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- The State Trading Corporation of India Ltd
- Global Business Power Corporation, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Goldman Sachs - Singapore
- Medco Energi Mining Internasional
- Jindal Steel & Power Ltd - India
- Videocon Industries ltd - India
- PNOC Exploration Corporation - Philippines
- MS Steel International - UAE
- Bhatia International Limited - India
- CNBM International Corporation - China
- Kapuas Tunggal Persada - Indonesia
- Dalmia Cement Bharat India
- Attock Cement Pakistan Limited
- SMG Consultants - Indonesia
- Indian Oil Corporation Limited
- Standard Chartered Bank - UAE
- South Luzon Thermal Energy Corporation
- Essar Steel Hazira Ltd - India
- Thiess Contractors Indonesia
- Therma Luzon, Inc, Philippines
- White Energy Company Limited
- Independent Power Producers Association of India
- Vizag Seaport Private Limited - India
- Billiton Holdings Pty Ltd - Australia
- Karbindo Abesyapradhi - Indoneisa
- SMC Global Power, Philippines
- Kepco SPC Power Corporation, Philippines
- Anglo American - United Kingdom
- Bukit Makmur.PT - Indonesia
- Riau Bara Harum - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- GN Power Mariveles Coal Plant, Philippines
- LBH Netherlands Bv - Netherlands
- Orica Mining Services - Indonesia
- Trasteel International SA, Italy
- Binh Thuan Hamico - Vietnam
- Energy Development Corp, Philippines
- Kideco Jaya Agung - Indonesia
- Iligan Light & Power Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Simpson Spence & Young - Indonesia
- Bharathi Cement Corporation - India
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- Global Green Power PLC Corporation, Philippines
- Baramulti Group, Indonesia
- Jorong Barutama Greston.PT - Indonesia
- GMR Energy Limited - India
- IHS Mccloskey Coal Group - USA
- Indian Energy Exchange, India
- Posco Energy - South Korea
- Commonwealth Bank - Australia
- Australian Coal Association
- Wood Mackenzie - Singapore
- SN Aboitiz Power Inc, Philippines
- Gujarat Sidhee Cement - India
- Ministry of Finance - Indonesia
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