Share Bazaar News India

Mundra Port and Special Economic Zone, India's largest non-government cargo terminal, has listed at Rs 770, a premium of 75% over its offer price of Rs 440 and touched a high of Rs 1050 on the NSE.

Ameet Desai, ED, Mundra Port & SEZ said they would be able to sustain CAGR of a high 30%. Coal and crude will contribute to a large part of the growth, almost 50-60%, going forward.

Container cargo, fertiliser, minerals, steel products are also seen as drivers. They see small stream of SEZ revenues this year onwards.

Excerpts from CNBC-TV18's exclusive interview with Ameet Desai:

Q: It is a spectacular listing at Rs 950, but there are couple of issues that are a niggling worry for your investors. Is litigation the reason why the Mundra Stock is not trading in F&O? Have you got any clarity from Sebi or from exchanges why it’s not trading in F&O today?

A: We have been informed by the book running lead managers that the decision to list it in the F&O category is kept in abeyance for some time. We have yet to get further details from Sebi and Stock Exchanges in the matter. We will work with them and make sure that the queries are answered. I do not see much of an issue going forward in this matter.

Q: Where do the pending litigation stand with DP world and with the State Government, with Mundra Port and those bodies?

A: That is an essential matter, which has just got a subjudice between DP World and us and it will come for hearing very soon. Since the matter is subjuidiced, I would not like to make further comments on that matter.

Q: Just line out the kind of growth that Mundra can expect both from the cargo front and whether or not this comes with an intended increase in tariffs over the next few financial years?

A: What we have always consistently maintained is that Mundra Port has distinct location advantages in terms of being the Northern-Western uppermost port in the country and that caters to a vast hinterland, which is highly industrialised and growing, both in industry and services sector.

We had high 30’s of CAGR in our cargo growth over the last 5-6 years and given the general economic growth and buoyancy in trade, we think coming years will see great growth in the port sectors.

We also have the added benefit of the multi-product SEZ being in the vicinity of the port, which will lead to the ports growth. The industries will grow too based on the logistics advantage of the port; we also have the multi-model business model of inland container depots and container trains to aid our port business growth.

Q: What does accelerated growth mean? Can you benchmark yourself against something like JNPT or Mumbai port and why Mundra will grow a lot more and by how much?

A: Without getting into direct comparisons, because we have grown from a much smaller base, we have been growing at a much larger number compared to most of the ports in the country. That is why I said our historical CAGR has been 39-40% over last 6 years in our cargo growth.

And particularly the connectivity and quick evacuation to the massive hinterland is a great reason why Mundra port will continue to grow.

Q: How much of your cargo revenues would come from your two segments, coal and crude going forward?

A: Coal and crude will always be contributing to a large part of our growth, but since Mundra Port is a multi-commodity port, besides crude & coal which are the key drivers, container cargo will also continue to grow at Mundra and some other commodities like fertilisers, minerals, steel coils, steel plates and steel pipes, which will also continue to grow.

But I think coal, crude and container will constitute about 50-60% of our cargo revenues going forward.

Q: By when do you think SEZ revenues will start kicking in to your overall revenue streams, could you give us a timeline?

A: In a small way, they will start kicking in from this year itself as units start coming into the SEZ and start setting their shop, first by way of lease income we get on the land that we lease to them. I think it will go an accentuated drive as more and more units come in actualising the port logistics advantages.

So this year onwards we are seeing small stream of SEZ revenues, which will grow in times to come.

Q: How have you valued your own SEZ prospects, what do you plan to do for for industrial expansion or growth?

A: Our SEZ has the following advantages; it has a port right in the SEZ, it has got a rail link, it has got road connectivity and also airport connectivity. This provides a great impetus for growth in terms of logistics convenience to the industries.

Therefore Mundra SEZ, which has got all the ingredients of industrial infrastructure in place, should become a very good platform for industries to come in and besides reaping the economic advantages, would also reap the logistics advantages.

Source: Moneycontrol.com