J M Baxi Ports & Logistics set to win the auction for container terminal at V O C Port, Infra News, ET Infra

    Dhruv Kotak
Dhruv Kotak

JM Baxi Ports & Logistics Ltd, part of the Mumbai-based JM Baxi Group, will acquire the rights to execute a container terminal contract with the state-owned VO Chidambaranar Port Authority (VOC Port) in the Thoothukudi district of Tamil Nadu.

JM Baxi Ports & Logistics led by Dhruv Kotak placed a price offer of Rs 1,900.44 per twenty feet equivalent unit (TEU) on a tender to convert a bulk cargo berth in the port into a privately funded container terminal when bids opened on Thursday , said several sources, including an official at VOC Port.

This is the second contract success in a month for JM Baxi Ports & Logistics after it triumphed in a tender by Jawaharlal Nehru Port Authority (JNPA) for the privatization of the container transhipment terminal operated by the state-owned port near Mumbai. The concession agreement for this terminal was signed on 29 July.

The contract gains will boost the valuation of JM Baxi Ports & Logistics ahead of a planned IPO of shares.

Port tenders in major ports (owned by the center) are decided on a royalty per TEU basis: the entity willing to share the highest royalty per TEU with the port authority wins the deal for 30 years.

The royalty payable will increase annually along with the rise in the Wholesale Price Index (WPI), a measure of costs. Under the new Large Port Companies Act and the model concession agreement (MCA), the terminal manager is free to set rates in line with the market.

JM Baxi Ports & Logistics operates container terminals at Visakhapatnam Port, Deendayal Port (Kandla), Haldia Dock Complex, a multi-purpose terminal at Paradip Port, container freight stations, inland container depots, bulk logistics, rail logistics (container trains), cold chain logistics and heavy project logistics.

In FY22, JM Baxi Ports & Logistics handled approximately 1.6 million TEUs and approximately 15 million tons (mt) of cargo across its facilities on the west and east coasts of India.

The privatization of Berth No. 9 into a container terminal (depth of 14.2 meters) with an investment of Rs 434.17 crore will increase the container handling capacity of VOC Port by 6 lakh twenty-foot equivalent units (TEUs) per year to 1, 8 million TEUs per year.

VOC Port, the third largest container handler of the dozens of state ports, currently has two container terminals in the inner port, which are operated separately by PSA SICAL Terminals Ltd (11.7 meters draft) and Dakshin Bharat Gateway Terminal Pvt Ltd (14 draft ,2 meters). meters) with a capacity to handle a total of 1.2 million TEU. The average occupancy rate of the two terminals is around 65 percent.

The two terminals together handled 7,81,458 TEUs or 15.4 million tons (mt) in FY22, compared to 7.62,000 TEUs in FY21.

Container freight accounted for about 45 percent of VOC Port’s total cargo of 34.12 million tons (mt) in FY22.

JM Baxi Ports & Logistics has won DP World Ltd, the global port operator owned by the Government of Dubai, which quoted approximately Rs 900 per TEU, and JSW Infrastructure Ltd (approximately Rs 650 per TEU) the successful bidder in the tender.

The project is part of the National Monetization Pipeline (NMP) in which operational infrastructure assets, including port terminals, will be privatized through the Public-Private Partnership (PPP) route.

The NMP has listed 31 cargo berths in nine of the 12 major ports for privatization by 2025.

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