GREAT ESATERN SHIPPING

Great Eastern Shipping was up after the company reported an over two-fold jump in consolidated net profit at Rs 192 crore for Q3FY13 despite a flat total income at Rs.759 crore  v/s Rs.758 crore on YoY. So this two-fold jump was not purely on the back of operational performance but more due to the forex gain of Rs.56 crore. What also helped was the 25% drop in its interest outgo at Rs.85 crore.

The company currently has a total shipping fleet of 34 vessels  and is in the process of adding four more offshore vessels, taking its total offshore fleet to 25 vessels.This is expected to boost revenues despite weaker freight rates. 80% of its fleet is on spot basis, not very good as a steady revenue earner. Though at this point of time, the outlook for the sector does not look too good, things are expected to get better from second half of FY14.

Looking ahead, the company has stated that in Q4, revenue could be around Rs.503 crore v/s Rs.450 crore in Q4FY12. This is India’s largest private sector shipping company. The company has two main business: shipping and offshore. The shipping business is involved in transportation of crude oil, petroleum products, gas and dry bulk commodities. The offshore business; services the oil companies in carrying out offshore exploration and production activities through its wholly owned subsidiary Greatship (India) Limited. The main promoter was Vijay Seth who created Great Offshore as a division of Great Eastern Shipping Co. but he lost control over the company after it was taken over by Bharati Shipyard. In 2009, when the value of shares he had pledged with financial institutions plunged below the value of the loans he had taken, there was no financial backing from his cousins and Bharati Shipyard bought the shares pledged by Sheth, 14.89% stake at Rs.315/share.  Bharati Shipyard currently owns a 49.73% stake in Great Offshore.