Hindustan Shipyard on the up

Vizag-based Hindustan Shipyard Limited (HSL), which is struggling financially, is expecting new orders worth more than $240 million in 2005-06. A spokesman for the yard said the yard?s shipbuilding order book was almost nil between 2000 and 2004 although last financial year it managed to win orders worth $97 million.

HSL, which is the oldest shipbuilding company in the country, recently signed a contract with Chennai-based Goodearth Maritime Limited for the construction of six 53,000 DWT bulk carriers. The order is worth $154 million and the company is expecting another shipbuilding order worth $91 million by the end of March 2006.

These will be the biggest bulk carriers that HSL has ever built and the first vessel would be delivered in 28 months while the yard plans to deliver the remaining vessels at six-monthly intervals.

In ship repairing, HSL achieved a turnover of $32 million in the fiscal year ended March 31, 2005, as compared to $16 million in the previous year. In the current fiscal year, the yard is expecting to achieve a turnover of $34 million in ship repairs.

On funding the newbuildings, the spokesman said “Completion of the existing ship-building orders is the biggest challenge for us. Though we are facing severe financial problems, we need to deliver the vessels on time to gain confidence from the shipping companies, or else our survival will be difficult. For this, we are implementing alternative financial ways. Earlier, HSL used to place orders for the necessary shipbuilding equipment and materials with its own funds. Now, due to lack of working capital, we are asking the shipping companies to supply the equipment for the construction of ships. This system is helping HSL deliver the vessels on schedule.”