Cochin Shipyard likely to enter the capital market

With the objective of capacity expansion, the Cochin Shipyard, requiring about Rs.1,500 crore, Cochin Shipyard is likely to enter the capital market to raise the necessary fund. The Union Government which owns the shipyard is contemplating with the idea of divesting a part of its 100 percent equity. Of course, the shipyard has to pass through many critical phases before it becomes listed on the stock exchanges. According to the Chairman and the Managing Director of Cochin Shipyard, Commodore Kartik Subramaniam, first, the feasibility studies must be completed on the expansion plans. He added: “As regards fund raising, we are at a very early stage; size of the IPO, its timing— all these will be decided only after finalizing the financing structure and getting Government approvals. If everything goes as planned, the yard may enter the market by the end of this fiscal”. As of now, the shipyard has identified three expansion plans: a new ship repair facility, a large dry dock and a fabrication yard for offshore structures. As for the repair facility, the company has already obtained the Cochin port’s tender. A large dry dock will prove an effective business proposition since, till now, most of the repairs of most of the rigs are undertaken at Singapore and other foreign yards. As for the fabrication work, the Cochin Shipyard has already been qualified by ONGC to meet their fabrication needs.

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