India's Bharati Shipyard Ltd expects to maintain its 2006/07 revenue growth at 30-35 per cent on increased shipbuilding orders and higher capacity, a senior official said on Friday.
The company with three shipyards would start work on its fourth yard in Mangalore in the south Indian state of Karnataka in August, spending Rs 4 billion over 2 years, Parag Doshi, Bharati's financial controller, said in an interview.
"The revenue growth would come from higher capacities we have now and due to the increased demand from the oil sector," Doshi said.
Bharati Shipyard had reported a 35 per cent increase in revenue to Rs 2.60 billion for the year ending March 2006.
The company, India's second largest private shipbuilder, has orders worth 11 billion rupees as on March 2006, a two-fold increase over the previous year.
Seventy percent of Bharati Shipyard's orders are for offshore support vessels (OSV) and anchor handling tugs, usually used in oil exploration.
In Asia, Singapore-based Labroy Marine, Dayang Shipbuilding in China and ABG Shipyard in India have recently started building OSVs and have emerged as leading players.
Expanding to export
Bharati, like its bigger Indian competitor ABG Shipyard, started expanding its yard at Ratnagiri in the western coast of Maharashtra state last year and will begin the process at its Goa facility later this year.
It had set aside Rs 700 million for the expansion of the two facilties, Doshi said.
The Ratnagiri and Goa facilities can make ships of up to 10,000 deadweight tonnage (DWT) and specialised vessels. The company's Mangalore facility would be for bigger vessels of up to 50,000 DWT capacity.
Demand is coming from overseas for Bharati. Since 2004/05 the company's exports have increased.
"Of my total order book today, 65 per cent is for exports...going forward it would be more from overseas clients," Doshi he said.
Its foreign client list includes Qatar-based Halul Offshore Services Co WLL, Cyprus Ports Authority, and Qatar Shipping Co.
Indian shipbuilding companies enjoy a 30 per cent subsidy on the total value of ships built for overseas clients, though disbursals are often delayed, and can, at times, affect cash flows.