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Jayanta Mallick

Kolkata , Jan. 14

STOCKS of shipping companies left their valuation anchorage at the major bourses today after a while as new positives were factored in.

According to experts, latest rising trend in the freight rates, for both dry-bulk carriers as also tankers, has provided additional fuel for the stocks to steam ahead.

Among the listed domestic shipping stocks, SCI saw a jump of around Rs 17 (9.3 per cent) with more than five fold increase in trading volume. The GE Shipping, Essar Shipping and Varun Shipping stocks also buoyed up in varying degrees on active buying support.

While the Essar Shipping counter gained by 12.7 per cent, GE Shipping was up by 2.9 per cent, Varun Shipping improved by 9.3 per cent and Mercator posted a gain of 5 per cent. According to Mr Gaurav Dua of Anagram Stock broking, better results expectation, prospects of capacity expansion and possibility of introduction of tonnage tax are serving as triggers for the further upward revaluation of the shipping stocks.

While the tonnage tax regime is expected to lessen the burden on profits, most of the companies are either in the process of increasing tonnage capacity or have started increasing them in the last few months. Apart from the record increase in dry bulk rates, the tanker rates are also quite firm.

"The growth from revenue streams and rise in cash flows have been phenomenal in the Q3 and the trend continues unabated in Q4 also," Mr Dua said.

Industry insiders told Business Line that the Chinese hunger for dry bulk commodities such as iron ore, alumina, grains and metallurgical coke have been driving the rates up of late.

SCI and GE Shipping are the best beneficiaries of this dry bulk boom, particularly in the international waters in the Asia-Australia routes. Dry bulk largely being tagged on to the spot rates as opposed to the long-term charter rates, both the India companies are gaining substantially.

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