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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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- Maharashtra Electricity Regulatory Commission - India
- Trasteel International SA, Italy
- Bahari Cakrawala Sebuku - Indonesia
- Power Finance Corporation Ltd., India
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- PowerSource Philippines DevCo
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sree Jayajothi Cements Limited - India
- Aditya Birla Group - India
- Kapuas Tunggal Persada - Indonesia
- Edison Trading Spa - Italy
- Malabar Cements Ltd - India
- Medco Energi Mining Internasional
- Central Java Power - Indonesia
- Simpson Spence & Young - Indonesia
- Siam City Cement - Thailand
- Parliament of New Zealand
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- Meralco Power Generation, Philippines
- Energy Link Ltd, New Zealand
- ICICI Bank Limited - India
- Ambuja Cements Ltd - India
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- Kaltim Prima Coal - Indonesia
- Directorate Of Revenue Intelligence - India
- Semirara Mining and Power Corporation, Philippines
- Savvy Resources Ltd - HongKong
- Indian Oil Corporation Limited
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- Coalindo Energy - Indonesia
- Ministry of Finance - Indonesia
- Aboitiz Power Corporation - Philippines
- Cement Manufacturers Association - India
- Price Waterhouse Coopers - Russia
- Vedanta Resources Plc - India
- Coal and Oil Company - UAE
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- Sinarmas Energy and Mining - Indonesia
- Grasim Industreis Ltd - India
- Xindia Steels Limited - India
- Bharathi Cement Corporation - India
- PNOC Exploration Corporation - Philippines
- Chettinad Cement Corporation Ltd - India
- TeaM Sual Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- Miang Besar Coal Terminal - Indonesia
- GMR Energy Limited - India
- Straits Asia Resources Limited - Singapore
- Bayan Resources Tbk. - Indonesia
- Renaissance Capital - South Africa
- Electricity Generating Authority of Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- TNB Fuel Sdn Bhd - Malaysia
- OPG Power Generation Pvt Ltd - India
- CNBM International Corporation - China
- Indika Energy - Indonesia
- Coastal Gujarat Power Limited - India
- Bukit Makmur.PT - Indonesia
- Energy Development Corp, Philippines
- Tata Chemicals Ltd - India
- New Zealand Coal & Carbon
- Deloitte Consulting - India
- Barasentosa Lestari - Indonesia
- GAC Shipping (India) Pvt Ltd
- Ind-Barath Power Infra Limited - India
- SMG Consultants - Indonesia
- Mintek Dendrill Indonesia
- Ministry of Mines - Canada
- Anglo American - United Kingdom
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- Bank of Tokyo Mitsubishi UFJ Ltd
- Pendopo Energi Batubara - Indonesia
- Thiess Contractors Indonesia
- Directorate General of MIneral and Coal - Indonesia
- San Jose City I Power Corp, Philippines
- Romanian Commodities Exchange
- The State Trading Corporation of India Ltd
- Gujarat Mineral Development Corp Ltd - India
- Vizag Seaport Private Limited - India
- Siam City Cement PLC, Thailand
- Wood Mackenzie - Singapore
- Global Green Power PLC Corporation, Philippines
- Ministry of Transport, Egypt
- Cigading International Bulk Terminal - Indonesia
- Thai Mozambique Logistica
- Formosa Plastics Group - Taiwan
- Semirara Mining Corp, Philippines
- Gujarat Sidhee Cement - India
- McConnell Dowell - Australia
- Global Business Power Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Banpu Public Company Limited - Thailand
- London Commodity Brokers - England
- IEA Clean Coal Centre - UK
- Wilmar Investment Holdings
- The University of Queensland
- Jaiprakash Power Ventures ltd
- Metalloyd Limited - United Kingdom
- Ceylon Electricity Board - Sri Lanka
- Lanco Infratech Ltd - India
- Indian Energy Exchange, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Mjunction Services Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Bhatia International Limited - India
- Orica Australia Pty. Ltd.
- Leighton Contractors Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- Videocon Industries ltd - India
- Georgia Ports Authority, United States
- Offshore Bulk Terminal Pte Ltd, Singapore
- Samtan Co., Ltd - South Korea
- Toyota Tsusho Corporation, Japan
- Economic Council, Georgia
- Central Electricity Authority - India
- White Energy Company Limited
- Neyveli Lignite Corporation Ltd, - India
- Interocean Group of Companies - India
- Sojitz Corporation - Japan
- CIMB Investment Bank - Malaysia
- Kumho Petrochemical, South Korea
- Latin American Coal - Colombia
- Rio Tinto Coal - Australia
- Baramulti Group, Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Independent Power Producers Association of India
- The Treasury - Australian Government
- Intertek Mineral Services - Indonesia
- International Coal Ventures Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Marubeni Corporation - India
- Salva Resources Pvt Ltd - India
- Eastern Energy - Thailand
- AsiaOL BioFuels Corp., Philippines
- Africa Commodities Group - South Africa
- Manunggal Multi Energi - Indonesia
- Larsen & Toubro Limited - India
- Alfred C Toepfer International GmbH - Germany
- ASAPP Information Group - India
- Star Paper Mills Limited - India
- Kideco Jaya Agung - Indonesia
- Carbofer General Trading SA - India
- Rashtriya Ispat Nigam Limited - India
- Standard Chartered Bank - UAE
- South Luzon Thermal Energy Corporation
- Sical Logistics Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Madhucon Powers Ltd - India
- LBH Netherlands Bv - Netherlands
- Timah Investasi Mineral - Indoneisa
- Heidelberg Cement - Germany
- Meenaskhi Energy Private Limited - India
- Altura Mining Limited, Indonesia
- Gujarat Electricity Regulatory Commission - India
- SMC Global Power, Philippines
- Minerals Council of Australia
- Petron Corporation, Philippines
- Planning Commission, India
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Orica Mining Services - Indonesia
- Mercuria Energy - Indonesia
- Bukit Baiduri Energy - Indonesia
- Australian Coal Association
- GVK Power & Infra Limited - India
- Therma Luzon, Inc, Philippines
- Electricity Authority, New Zealand
- Indonesian Coal Mining Association
- Chamber of Mines of South Africa
- Karaikal Port Pvt Ltd - India
- Borneo Indobara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Bhushan Steel Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Essar Steel Hazira Ltd - India
- Commonwealth Bank - Australia
- Krishnapatnam Port Company Ltd. - India
- Global Coal Blending Company Limited - Australia
- Riau Bara Harum - Indonesia
- Australian Commodity Traders Exchange
- Bhoruka Overseas - Indonesia
- Goldman Sachs - Singapore
- India Bulls Power Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Indogreen Group - Indonesia
- Antam Resourcindo - Indonesia
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- Sindya Power Generating Company Private Ltd
- Vijayanagar Sugar Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Merrill Lynch Commodities Europe
- Maheswari Brothers Coal Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Posco Energy - South Korea
- IHS Mccloskey Coal Group - USA
- Parry Sugars Refinery, India
- Kartika Selabumi Mining - Indonesia
- Makarim & Taira - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Port Waratah Coal Services - Australia
- MS Steel International - UAE
- Asmin Koalindo Tuhup - Indonesia
- Mercator Lines Limited - India
- SN Aboitiz Power Inc, Philippines
- VISA Power Limited - India
- Singapore Mercantile Exchange
- Bulk Trading Sa - Switzerland
- Kepco SPC Power Corporation, Philippines
- PTC India Limited - India
- Sakthi Sugars Limited - India
- Tamil Nadu electricity Board
- Agrawal Coal Company - India
- Billiton Holdings Pty Ltd - Australia
- Eastern Coal Council - USA
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