JSW Infra’s profit more than doubles to ₹251 cr in Oct-Dec

The JSW Group company had reported ₹114.89 crore in net profit a year ago.

Its revenue from operations in the third quarter of 2023-24 stood at ₹940.11 crore, rising 17.85% y-o-y. The new container segment accounted for around 2% of the total volumes during the quarter, it said in a statement.

“The higher volume translated to growth in the total revenue. Increased revenue, the benefit of operating leverage and cost control meant a robust Ebitda margin, resulting in a solid growth of PAT (profit after tax) y-o-y… Our current utilization rate is approximately 65%, up from 63% previously, reflecting a continuous upward trend. In the port industry, reaching 70-75% capacity triggers the need to invest in additional capacities, especially considering our mix of terminals and ports,” said Arun Maheshwari, joint managing director and chief executive, JSW Infrastructure.

“Technically, we have the potential to achieve utilization levels of 80-85%…Fortunately, our assets are strategically located near key terminals and mines, facilitating faster utilization. For example, within just two years of operation, our full terminal saw utilization rates climb from 40% to 60%, establishing it as India’s largest coal export terminal. This rapid capitalization underscores our robust performance in the industry,” he told Mint.

India’s second-largest private port operator reported an Ebitda (earnings before interest, taxes, depreciation and amortization) of ₹558 crore in the quarter, registering a growth of 33% y-o-y. Ebitda margin came in at 54.8%. The company also reported a cash holding of ₹3,764 crore.

The total cargo handled by the company stood at 28.1 million tonnes, 17% higher on-year. The increase in the third-party volume, the company said, was even stronger at 47% y-o-y and the share of third party in the overall volumes stood at 39%, compared to 31% a year ago. “The increase in the volume is primarily on the back of increased capacity utilization at the Paradip iron ore terminal, Paradip coal terminal and Mangalore coal terminal. Also, at the Mangalore container terminal, cargo volumes grew by 33% y-o-y,” the firm added.

The company currently has about 60:40 ratio of capacity on the western and eastern coasts of the country, and aims to maintain this distribution. “We currently hold two-thirds of our operations on the west coast of India and one-third on the east coast, and we intend to maintain this balance. If my entire business were located on the east coast of India, there would be no justification for expanding to the west coast. However, given India’s current growth trajectory and business trends, the distribution stands at 60-40% in favour of the west and east coasts, respectively. And hopefully, the investment will happen in the same fashion unless there is a bigger push from the east coast of India. We will have to deploy more funds and we are not averse to that,” Maheshwari added.

The port operator, with a total cargo handling capacity of 170 million tonnes per annum (MTPA), received environmental clearance for an additional 1.6 MTPA capacity at its Ennore coal terminal.

The terminal has a cargo handling capacity of 9.6 MTPA. The company also had a winning bid for the development of a greenfield port in Karnataka, with a capital expenditure estimated at ₹4,119 crore and an initial capacity of 30 MTPA.

JSW Infra also acquired a majority stake in PNP Maritime Services (PNP port), located at Shahbaj, Raigad district, Maharashtra. “The purchase considerations being ₹270 crore for 50% plus 1 share of the paid-up capital of the PNP port. The port has a current capacity of 5 MTPA and the potential to expand to 19 MTPA,” it added. It also completed the acquisition of a liquid storage facility in the UAE. Adding new ports and facilities has helped the company reach more than half of its 300 MTPA target for 2030.

The company is also assessing an opportunity to develop an international transhipment port project at Galathea Bay in the Great Nicobar Island, for which the government aims to invite expressions of interest. “Once it comes into the block for bidding or offers, that time we will assess and we will see what all and how can we participate in that,” Maheshwari said.

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Published: 03 Feb 2024, 12:00 AM IST