The Hindu Business Line : ‘We’re actively considering port operations outside the country’

Achieving a turnover of Rs 1,000 crore is not a big deal. What is more important is for us to position ourselves as a knowledge-based company providing total solutions for the entire logistics chain.

MR DIBYENDU BOSE, MD, TM INTERNATIONAL LOGISTICS LTD

Santanu Sanyal

TM International Logistics Limited (TMIL), a joint venture between Tata Steel and Martrade of Germany, with Tata Steel holding the majority (51 per cent) stake, was launched in January 2002. It started with port operations through acquisition of a berth at Haldia dock on a long-term lease. TMIL has come a long way since then, having diversified into various areas in logistics services and is now poised to offer total logistics solutions to consumers of various verticals. Mr Dibyendu Bose, Managing Director of TMIL, recently spoke to Business Line on the performance of the company and its prospects.

Excerpts from the interview:

How was your company’s performance in 2007-08?

Not too bad. In 2007-08, TMIL posted about 80 per cent growth in turnover at Rs 623 crore and more than 100 per cent growth in profit before tax at about Rs 60 crore.

How would you explain this?

The overall performance has been satisfactory, but shipping services and freight forwarding have been particularly good. Under shipping services, controlled by our Dubai-based subsidiary, International Shipping & Logistics, we undertake both vessel chartering, mostly time-chartering, and ship operations. These services contribute to nearly 40 per cent of our business. We also do ship-broking, though from our Kolkata office.

And freight forwarding?

The freight forwarding is undertaken by another subsidiary, TKM, which is registered in India. This company is engaged in freight forwarding for both sea-borne and air traffic and also acts as NVOCC (non-vessel owning cargo carrier). This subsidiary also contributes another 40 per cent or so of our business. TKM too has a subsidiary, TKM Global, based in Hamburg, Germany, again for undertaking freight forwarding operations.

How big is your business as NVOCC?

Not very big. We have acquired on lease about 2,000 ISO containers and our operation is spread over 30 ports, both in India and abroad. The present size of business is about Rs 20 crore but we see in it good potential, which we are going to tap. As a first step, we plan to take advantage of IT and will soon introduce SAP.

TMIL started with port operations, isn’t it?

True, we started with port operation through acquisition of an existing berth on a 30-year lease at Haldia. Since then we’ve come a long way and diversified into various fields related to logistics services covering chartering, ship operation, port operation, freight forwarding, warehousing, storage — the list is long. But we continue to be active in port operation too.

At Haldia dock, we handle close to four million tonnes, annually. In addition to the berth (No. 12), which we acquired there on long-term lease, we also operate in other berths of the dock.

The throughput of the Berth No.12 is about one million tonnes annually, and Tata Steel accounts for just 20 per cent of it.

We serve many other customers too, including the National Thermal Power Corporation. We have acquired 16 acres of land adjacent to the berth to create facilities to serve our customers better. There will be two railway sidings. Hopefully, the facilities will be ready for operation within a month or two, though the railway facilities will take time to be ready.

At Paradip port, where we do not have any dedicated berth like the one at Haldia, we handle about 3.5 mt annually. TMIL has teamed up with a major construction and engineering company to bid for the deep draft coal berth proposed to be built at Paradip on a BOT basis. About half a dozen firms are believed to have been short-listed and TMIL, together with its joint venture partner, is one of them.

How strong is your presence in west coast ports?

We have no dedicated berths in any of the west coast ports but that does not mean we have no presence in all these ports. We have substantial presence, through our various other activities, in several ports in Gujarat, including Kandla, and also in New Mangalore port. We are looking at opportunities on the west coast to enhance our presence there.

What happened to your participation in a Tata Power berth?

The proposal, mooted a long time ago, did not make headway.

Do you have plans for port operations outside the country?

Yes. We’re actively considering it and have before us several proposals for consideration. The decision in this regard will be firmed up in due course. The way the Tata Group is growing, both within the country and outside, it is only natural that we will also spread our wings in different directions.

The prospects for 2008-09?

We will continue to perform well.

Are you targeting a Rs 1,000-crore turnover?

Frankly, achieving a turnover of Rs 1,000 crore is not a big deal. It will, in any case, be achieved next year, if not in the current year. What is more important is for us to position ourselves as the knowledge-based company providing total solutions for the entire logistics chain to cater to the requirements of customers of several verticals, such as steel, coal, automobiles and the like. We are confident of achieving this.

More Stories on : Interview | Shipping | Tata Steel Ltd

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