Government-owned Shipping Corporation of India (SCI) has continued to hit the profit trail, posting a net profit of INR1.63 billion (USD25 million) for the first quarter ending 30 June 2015, benefiting from the rally in tanker markets.
Turnover, however, dropped slightly to INR10.9 billion against INR12 billion for the corresponding quarter ending 30 June 2014.
“The quantum leap in profits during the quarter has been attributed to the rally in tanker markets aided by the continued slide in world crude oil prices,” SCI said in a press release.
The latest net profit amount is considerably higher than that for the quarter ended 30 June 2014 that had amounted to INR495 million. Profits had soared thereafter, up to INR1billion for the quarter ended 31 March 2015 and increasing to INR2 billion for the entire year ending 31 March 2015.
“We have a large fleet of tankers and the rise in tanker freight rates coupled with cheaper bunkers following the fall in crude oil prices drove our profits,” Chairman and MD Arun Kumar Gupta told IHS Maritime. Bunker costs were more than halved during the quarter.
SCI operates 35 tankers out of a total fleet of 69 vessels aggregating 5.89 million dwt.
Gupta conceded that falling oil prices was not good news for offshore asset owners as exploration and production (E&P) activity has fallen substantially. SCI operates nine offshore supply vessels and Gupta pointed out that all SCI vessels have found employment.
“The Indian offshore market is insulated from the current downturn so we are not affected,” he observed.
SCI also operates 17 dry bulk vessels and is still active in the liner trade, where five container ships have been deployed. The liner division has been incurring continuous losses, which has sparked market talk about SCI exiting the container trades, but Gupta refused to comment on rumours.