Background:
- Cochin Shipyard Ltd. (CSL) was incorporated in the year 1972 as a fully owned Government of India Company. After the completion of the IPO in the FY 2018 and the Buyback in FY 2019 the Government of India holds 75.21% of equity share capital in the Company. In the last four decades, the Company has emerged as a forerunner in the Indian shipbuilding & ship repair industry and also a well-known player on the global shipbuilding front. CSL has exported 45 ships to various commercial clients outside India such as National Petroleum Construction Company (Abu Dhabi), the Clipper Group (Bahamas), Vroon Offshore (Netherlands) and SIGBA AS (Norway). The yard is presently building the prestigious Indigenous Aircraft Carrier for the Indian Navy. India is only the fifth nation in the world to build an aircraft carrier of this size.
- The Company has built and repaired some of the largest ships in India and is presently building the prestigious Indigenous Aircraft Carrier for the Indian Navy. Over the years, CSL has successfully responded to fluctuations in the shipbuilding requirements of the markets and have evolved from building bulk carriers to smaller and more technically sophisticated vessels such as Platform Supply Vessel (PSV) and Anchor Handling Tug Supply Vessels (AHTS). CSL has worked with several leading technology firms in the industry including Rolls Royce Marine (Norway), GTT (France), Vard Group (Norway) etc. This has added to the company’s credibility in the international markets. CSL’s key shipbuilding clients on the domestic front include the Indian Navy, the Indian Coast Guard , Inland Water Authority, JSW group etc. CSL has also undertaken repairs of various types of vessels including upgradation of ships of the oil exploration industry as well as periodical maintenance, repairs and life extension of shipsand is presently one of the best performing shipyards in India.
Performance Highlights
4. The hall mark of Cochin Shipyard is its diversified product profile and operational segment. CSL is one of the very few yards which is operating in both shipbuilding and shiprepair segment. Within the segment the company is again one of the very few yards worldwide which undertakes both commercial and defence projects. The yard is well known for its quality and production efficiency which has translated into robust financial performance. The turnover of the yard increased by 2.36 times from ₹1256.21 crs in 2008-09 to ₹2962.16 crores in 2018-19 and the EBITDA (Earnings Before, Finance Cost, Tax, Depreciation and Amortisation) also increased 2.89 times from ₹276.42 crores to ₹799.83 crores during the same period.Company had been consistently declaring dividend for the last 10 consecutive years. Based on its consistent performance, CSL was conferred with “Miniratna” status in 2008.
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Ongoing projects in Shipbuilding
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5. Recently, CSL has been successful in securing against intense competition shipbuilding orders for 8 Nos. of ASW corvettes for Indian Navy, 4 Nos. of mini bulk carriers for a JSW group concern and 9 Nos. of floating border outposts for BSF. The Company also received on nomination 8 Nos. of ROPAX vessels & 2 Nos. of RO-RO vessels for Inland Water Authority of India, 3 Nos. of marine ambulance boats for Kerala Fisheries Department, and 2 Nos. of brows and pontoons for Indian Navy. |
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Ship Repair
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7. In the ship repair area, CSL is the only yard which has undertaken the dry-dock repair of Aircraft carriers of the Indian Navy. The yard has also repaired high end offshore rigs of ONGC. CSL has also repaired and upgraded ships of SCI, DCI, various Port Trusts, Indian Coast Guard and Indian Navy and has the expertise to carry out a wide variety of repairs and refurbishments. So far, CSL has repaired more than 2000 ships of various types owned by major Indian and foreign owners and has a major market share of the ship repair business in India. 8. Key repair projects undertaken by CSL recently included INS Vikramaditya, INS Shardul, Modu Sagar Bhushan, ICGS Samar, INS Sagardhwani, RV Sindhu Sadhana, INS Jamuna etc. 9. The company has identified very high business potential in the Indian ship repair industry which has remained untapped due to lack ofcapacity. CSL is very well placed to take advantage of this opportunity due to its strategic location, very near to the maritime trade route.
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Expansion Plans
10. CSL is in the process of expanding its existing capacity in shipbuilding and shiprepair by adding a new dry dock at CSL premises and an International Ship Repair Facility (ISRF) at Cochin Port Trust land taken on 30 year lease. The total capex for putting up the above two facilities is Rs 2768 crores. The proposed Dry Dock and ISRF will increase CSL’s ability to build, repair and service a broader range of vessels including vessels of larger capacities.
International Ship repair facility (ISRF) project at Cochin Port Trust
11. CSL had taken over on 30 years lease the existing ship repair facility of Cochin Port Trust located at Willingdon Island, Kochi and is in the process of developing it into a state-of the–art international ship repair facility by installing ship lift, & transfer system, 6 dry berths & associated facilities. Foundation stone for ISRF project was laid on November 17, 2017 byShri Nitin Gadkari, Hon’ble Union Minister for Shipping,Road Transport & Highways, Water Resources, RiverDevelopment and Ganga Rejuvenation.The construction works, which commenced on November 17, 2017, is progressing in full swing. As a part of CSL’s efforts to develop Kochi as a maritime hub of India, CSL is setting up a maritime park adjacent to the ISRF premises to house major OEMs and service providers of the ship repair industry.CSL expects to position Kochi as a major ship repair hub with major operations in the present ship repair dock coupled with increased capacities that would be available when the ISRF is commissioned.
New Dry-dock Project
12.The new dry-dock measuring 310 x 75/60 x 13m with 600T gantry crane will be located at the northern end of the existing premises of the Company. The new dock will augment the Company’s shipbuilding and ship repair capacity essentially required to tap the market potential of building specialized and technologically advanced vessels such as, Aircraft Carriers of higher capacity, jack up rigs, drill ships, large dredgers and repairing of offshore platforms and larger vessels. Shri Nitin Gadkari, the Hon’ble Union Minister of Shipping, Road Transport and Highways, and Shri Pinarayi Vijayan, the Hon’ble Chief Minister of Kerala did the honours of ground breaking ceremony of the dry dock project on October 30, 2018.
Geographical diversification and new initiatives
13.Cochin Shipyard has formed a new company viz Hooghly Cochin Shipyard Limited for upgradation and modernization of the two shipyard sites at Salkia and Nazirgunge in Kolkata. The new company which is a subsidiary of CSL was incorporated in October 2017 as a joint venture between CSL and Hooghly Docks and Port Engineers Limited. The new company’s focus would be to build and repair ships for the Inland waterways segment especially the vessels plying in the National Waterways 1.
14.CSL has entered into an agreement with the Mumbai Port Trust on October 20, 2018 for operations and management of ship repair facility at Indira Dock. Subsequent to the execution of the agreement, CSL has commenced the ship repair operations in Mumbai on January 18, 2019.. It is expected that once stabilized, the ship repair operations will add significant strength to CSL’s overall ship repair portfolio.
15.CSL signed the agreement with Kolkata Port Trust on March 28, 2019 for operations and management of ship repair facility at NetajiSubhas Dock, which shall be focusing on the ship repair requirements at Kolkata area and inland waterways.
16. CSL has also signed a MoU with Andaman & Nicobar (A&N) Administration for setting up its unit at Port Blair in September 2018. The agreement with A&N is in the administrative phase and is expected to be cleared in the current FY. By entering into this arrangement with A&N Administration, CSL shall be developing an integrated ship repair ecosystem at A&N islands that includes modernisation of facilities, maintenance of Administration owned vessels and skill development for the islanders
Future Vision and prospects
17. Cochin Shipyard’s vision is to emerge as “one of the world’s top 10 integrated marine building, repair & training services companies and India’s most respected commercial, defence ship and Offshore structure building facility. To be admired for our achievements, respected for our ethics and trusted for our service excellence by our valued customers”.
For further details please see website: www.cochinshipyard.com