Krishnapatnam Port Company (KPCL), which owns Krishnapatnam port on the east coast, is planning to sell part of its equity to raise funds to finance its ongoing expansion programme. Krishnapatnam Port Company is currently implementing its second phase of port expansion project involving a capex of Rs. 4,000 crore.
As per original schedule, the second phase was to be completed by January 2012. However, Krishnapatnam Port Company could not complete the project on time due to financial constraints faced by the company. It may be recalled here that last year ICRA had downgraded Krishnapatnam Port Company’s term loan facility. Traffic growth at the port had impacted due to ban on iron-ore mining in the major mining belts of Karnataka thereby affecting its revenue which in turn had created liquidity problems for the company.
Krishnapatnam Port Company is reportedly in talks with two Private Equity firms to offload 6% stake and raise Rs. 1,200 crore for its expansion. KPCL is reportedly aiming to complete the second phase of expansion by December 2013.
In the mean time KPCL is also planning third phase of expansion which will make the port a coal hub. The company is targeting handling of bulk cargo of 100 MTPA by 2025 besides six million TEU targeted for container Cargo.
