Essar Shipping storms ahead on raising funds for new vessels:

Essar Shipping surged 2.24%, to Rs 25.10 on raising $ 200 million from overseas banks to finance ship-buying plans. As many as 1.05 lakh shares were traded on the BSE. The stock has surged sharply from late July 2006. From a low of Rs 21.10 on 21 July 2006, it rose to Rs 24.70 by 17 August 2006. At the current market price of Rs 25.10, Essar Shipping trades at 7 times its Q1 June 2006 annualized EPS of Rs 3.47. Essar Shipping & Logistics parent of Essar Shipping said on Wednesday that it had raised $ 200 million from a consortium of overseas banks to finance its subsidiary's ship-buying plans. The 10-year facility was fully underwritten by De Nationale Investeringsbank N.V. Inc. and was availed at a pricing of 120 basis points over the LIBOR rate, the company said. Essar Group announced last Thursday that it had consolidated its shipping and logistics business under Essar Global, its overseas investment arm. Essar Global’s Cyprus-based subsidiary, Essar Shipping and Logistics will manage the business. Essar Shipping and Logistics would have three operating companies -- Essar Shipping, Essar Logistics and Vadinar Oil Terminal. Essar Shipping said in June that it had sold Vadinar Oil and Essar Logistics to Essar Shipping and Logistics for $ 215 million. Essar Shipping is 77% owned by Essar Shipping and Logistics. Last month, the Essar Group was paid around Rs 3,825 crore to ramp up its holding in two group companies, Essar Shipping and Essar Oil, by buying out global depository receipts from international investors. In March, Essar Shipping acquired a very large crude carrier (VLCC) with a cargo capacity of 2,81,396 dead weight tonne (DWT) for Rs 550 crore. With this acquisition, Essar Shipping's fleet size increased to 27, with the total tonnage rising to 1.3 million DWT. Industry sources estimated the deal between Rs 525-550 crore. Essar Shipping plans to acquire more vessels, including Suemax, Panamax, mini bulk carriers, handymax, bulk carriers and barges. The company targets a young fleet with a mix of medium and large-sized tankers with sufficient bulk tonnage too. Essar Shipping also acquired a crude oil carrier built in 2005 at Hitachi Heavy Industries, Japan. Upon this acquisition, the company will have the largest fleet of modern double-hull, double-bottom VLCC fleet in the private sector. Essar Shipping derives almost 65% of revenues from energy transportation, with the firm having long-term relationships with international oil majors such as Shell and Mobil. The balance comes from the dry bulk business. Essar Shipping registered a decline of 66% in its net profit to Rs 36.97 crore (Rs 110.37 crore). Net sales during the period rose 24% to Rs 279.57 crore from Rs 224.63 crore. [From Internet] Best wishes, Suman Mukherjee India. Note: Google is creating problem in this blog, as I have removed their ads. So please use www.pkblogs.com/sumanspeaks if the site does not open in a normal way. Everytime I write something, I have to send this note, as the site never open otherwise..