Container Update - October 2020J. M. Baxi & Company Page 1

MONTHLY REPORT

OCTOBER 2020

CONTAINER

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Disclaimer:The information contained in this market update is drawn from wide range of newspapers, business and trade magazines, government, company and

industry association websites. While all possible care is taken to verify the correctness and authenticity of information contained in this compilation,

no claim to independent authorship of articles is implied or intended. Readers are expected to make their own independent evaluation and verification

of information for their use. While all information contained in this report are believed to be correct, the editors of this compilation or J. M. Baxi & Co.

do not guarantee the quotes or other data and the same is provided only in good faith.

Table Of Content

Adani Ports and SEZ completes acquisition of Krishnapatnam Port Co

PSA launches online payments solution for DPD customers at JNPT terminal

APSEZ to introduce train access charge at Mundra port from November 1

JNPT handles 3,80,384 TEUs cargo in September

Mundra Port terminal transfer deal under scanner over Chinese link

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KEY HIGHLIGHTS

PORT ANALYSIS

PORT ANALYSIS

TERMINAL SEPT - 2020 AUG - 2020

Adani CMA Mundra Terminal (ACMTPL) 94364 84045

Adani Ennore Container Terminal (AECTPL) 8729 7715

Adani Hazira Container Terminal(AHCT) 62121 50103

Adani International Container Terminal (AICTPL) 201319 212613

Adani Kattupalli Port Private Limited (AKPPL) 43690 45381

Adani Mundra Container Terminal (AMCT) 72844 74315

APM Terminal Mumbai (APMT) (GTI) 133602 140218

Bharat Mumbai Container Terminal(BMCTPL) 83205 64984

Chennai Container Terminal  (CCTL) 50490 49275

Chennai International Terminals Pvt Ltd (CITPL) 71942 66213

Dakshin Bharat Gateway Terminal (DBGT) 47157 46927

Haldia  12459 12813

International Container Transshipment Terminal, Kochi (ICTT) 62472 54792

JNPT 43912

KAKINADA CONTAINER TERMINAL 3455 1931

KANDLA  43873 45382

KOLKATA 51121 47406

NCT - Krishnapatnam 30288 23588

Mumbai International Cargo Terminal(MICT) 85895 79106

Nhava Sheva International Container Terminal (NSICT) 48344 65180

Nhava Sheva India Gateway Terminal (NSIGT) 70699 33937

PIPAVAV 51796 56977

Tuticorin Container Terminal(TCT) 19125 17823

Visakha Container Terminal Pvt. Ltd.  (VCTPL) 46103 42158

T-2 Mundra - -

Paradip 1419 1192

Container Throughput (in Teus)

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Adani Ports and Special Economic Zone (APSEZ) on Monday said it has completed the acquisition of Krishnapatnam Port Company Ltd (KPCL) for an enterprise value of Rs 12,000 crore. The company acquired controlling stake of 75 per cent in India’s second largest private sector port and said the acquisition will accelerate handling of 500 million tonnes (MT) throughput by 2025. With this acquisition, APSEZ is expecting its market share in FY21 to increase from 21 per cent to 25 per cent. “APSEZ, India’s largest port developer, operator and the logistics arm of the Adani Group, today announced the completion of the acquisition of KPCL for an enterprise value of Rs 12,000 crore. This will result in APSEZ having a controlling stake of 75 per cent in KPCL from the CVR Group and other investors,” the company said in a statement. KPCL is a multi-cargo facility port situated in the southern part of Andhra Pradesh, a state which has the second largest coastline in India. The company said: “In FY21, the port is expected to generate an EBITDA of approximately Rs 1,200 crore, resulting in an acquisition EV/ EBITDA multiple of 10x”. This acquisition will accelerate APSEZ’s stride towards 500 MMT (metric million tonnes) by 2025 and is another step in implementing APSEZ’s stated strategy of cargo parity between west and east coasts of India, it added. Karan Adani, Chief Executive Officer and Whole Time Director of APSEZ, said, “I am happy that KPCL, the second largest private port in India, has now become part of APSEZ portfolio. This transformational acquisition enables us to roll out world class customer service to an increased customer base and provide pan India solution to them.” “Our experience of turning around acquisitions like Dhamra and Kattupalli ports will enable us in harnessing the potential of KPCL. We will target to enhance throughput at KPCL to 100 MMT by FY25 and double its EBIDTA by FY23,” he added. With a vast waterfront and land availability of over 6,700 acres, KPCL is capable of replicating Mundra and would be future ready to handle 500 MMT, Adani said. “We will replicate

ADANI PORTS AND SEZ COMPLETES ACQUISITION OF KRISHNAPATNAM PORT CO

The company acquired controlling stake of 75 per cent in India’s second largest private sector port and said the acquisition will accelerate handling of 500 million tonnes (MT) throughput by 2025.

our operations and maintenance philosophy at KPCL, continue to focus on environment, reduce emission levels and have zero tolerance for fatalities and thus improve returns to stakeholders,” he said. APSEZ, a part of globally diversified Adani Group, is the largest port developer and operator in India with a formidable presence in port infrastructure and logistics services. APSEZ’s 11 strategically located ports and terminals represent 24 per cent of the country’s total port capacity, handling vast amounts of cargo from both coastal areas and the vast hinterland. The company is also developing a transhipment port at Vizhinjam, Kerala and a container Terminal at Myanmar.

Source: Financial Express

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PSA LAUNCHES ONLINE PAYMENTS SOLUTION FOR DPD CUSTOMERS AT JNPT TERMINALBMCT’s DPD customers will now be able to process their documentation and pay terminal handling charges on the ODeX platform from September 15, 2020, the terminal said in a statement. A first for the Jawaharlal Nehru Port area, the online payments product is jointly developed by BMCT and ODeX to support digital India and ease of doing business initiatives. The solution allows BMCT’s growing number of DPD customers to take the documentation, payment and delivery process online via a one-stop portal. The OdeX portal provides real time status updates, documentation uploading/amendment, e-payment and confirmation for delivery. With no requirement to maintain advance deposits, it also improves cash flow for the DPD customers. DPD means import containers are delivered directly to pre-approved clients at the port itself instead of waiting in a CFS located outside for clearance, which reduces cargo dwell time and cost for shippers. “A rapid and seamless flow of information between terminal and users is as important as the physical flow of containers through the terminal. This product gives our DPD customers a fast, efficient and secure payment and documentation system to take delivery of their goods as soon as possible. With ODeX’s extensive user base, it is well positioned for widespread adoption,” K Sivakumar, managing director of BMCT, said. “Customers can now pay through a single click on ODeX – and the payment is confirmed in real time to BMCT. Thus, any payments delay in cargo release is completely eliminated. During the current pandemic, BMCT has been responsive to the needs of customers and we have gone live very quickly with this solution thereby becoming the first terminal to offer seamless ePayment solutions on ODeX to customers,” said Liji Nowal, managing director of ODeX.

Source: The Hindu Business Line

Bharat Mumbai Container Terminals (BMCT), the facility run by Singapore’s PSA International Pte Ltd at Jawaharlal Nehru Port Trust (JNPT) near Mumbai, has launched a digital online payments solution for Direct Port Delivery (DPD) customers with ODeX.

Adani Ports and Special Economic Zone Ltd (APSEZ) said that it will introduce a new access charge on all trains arriving at Mundra port– the Ahmedabad-based conglomerate’s flagship port and India’s biggest commercial port by volumes handled.

APSEZ TO INTRODUCE TRAIN ACCESS CHARGE AT MUNDRA PORT FROM NOVEMBER 1The new charge, will be applicable from November 1, has been set at ₹7,500 plus GST per access (part/full), APSEZ said in a trade notice, adding that it is being introduced “for utilising the railway infrastructure at Mundra port for a safe and reliable operation”. The train access charge is applicable for all the container trains arriving at Mundra port. The charges will be levied on the container train operators (CTO) at the inward entry of train. Besides, APSEZ said that the twist locks of container train wagons were found to be defective on many occasions leading to safety and operational concern while handling. To compensate for the exceptional handling in such cases, ₹5,000 plus GST per event will be payable by the CTO, it said. Mundra port caters to the northern hinterland with multimodal connectivity. It provides nation-wide integrated connectivity between the container terminals at Mundra and various inland container depots (ICDs) in North-West India. Container train operators said that they will recover the additional cost by passing it on to the exporters.

Source: The Hindu Business Line

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The country’’s leading port JNPT said it handled 3,80,384 twenty-foot equivalent units of cargo in September , which is 95 per cent of the cargo handled in the same month a year ago. As compared to August, the growth in throughput was 7.8 per cent, indicating early signs of recovery which is very significant during the ongoing pandemic that has affected businesses across the country, the Jawaharlal Nehru Port Trust (JNPT) said in a release. The throughput in August was 3,52,735 twenty-foot equivalent units (TEUs). The port said in the first half of 2020-21 (April-September), it handled 1.92 million TEUs as against 2.57 million TEUs in the year-ago period, while the overall traffic handled during this period was 26.93 million tonne as compared to 34.41 million tonne in the same period a year ago, it said. “Various initiatives like direct port entry and delivery, internal terminal rail handling operations and internal terminal transportation have helped in reducing the dwell time and with the installation of scanners and the centralised parking plaza being fully operational by this month, the efficiency of the port will further improve,” said Sanjay Sethi, Chairman, JNPT. “The international maritime sector is evolving rapidly and the business demands are constantly changing and hence it is imperative that we also develop our capabilities to stay ahead in the competitive market,” he added. The port also handled discharge of 92,786 MT of LPG in six vessels, by giving priority and timely berthing to the LPG vessels for fulfillment of the Pradhan Mantri Ujjwala Yojna, said the release. The total LPG handled in the current financial year till September was 4,59,283 MT as compared to 4,19,562 MT handled in the previous year which is an increase of 9.5 per cent, JNPT said. At the liquid cargo terminal, JNPT has been handling essential commodities like LPG, high speed diesel, motorspirit and edible oil which is further supplied to Maharashtra, Gujarat, Karnataka, Goa, Madhya Pradesh and New Delhi.

Soirce: Outlook India

JNPT HANDLES 3,80,384 TEUS CARGO IN SEPTEMBER

At the liquid cargo terminal, JNPT has been handling essential commodities like LPG, high speed diesel, motor spirit and edible oil which is further supplied to Maharashtra, Gujarat, Karnataka, Goa, Madhya Pradesh and New Delhi.

Agreement between the Adani Group’s French JV partner and Chinese state-owned enterprise CMG could red flag proposal.

MUNDRA PORT TERMINAL TRANSFER DEAL UNDER SCANNER OVER CHINESE LINKA proposal to transfer partial ownership of a terminal at India’s busiest Mundra port in Gujarat to a Chinese company is now under the scanner of the Ministry of External Affairs (MEA) and the Ministry of Home Affairs (MHA), after an agreement between the Adani Group’s French joint venture partner CMA Terminals and the China Merchants Group (CMG), a Chinese state-owned enterprise. While the Adani Group has clarified that it has not filed the application itself, the proposal could see red flags from the government’s security agencies that have already put other Chinese acquisitions on hold for the last few months. According to the application submitted by CMA Terminals of France on May 21 this year, the company that is a joint venture partner of Adani Ports and Special Economic Zone Limited (APSEZ), engaged in “developing, operating, maintaining terminal CT-4 at Mundra Port”, wants to turn over its 50% stake to the CMA-CGM group, under a joint venture between the French company and the China Merchants Group (CMG). Effectively, the transaction would result in a China Merchants Group subsidiary taking an indirect, minority stake of 24.9% in the Adani-CMA Mundra Terminal. Senior government officials who confirmed receiving the application told The Hindu that the deal has “not been cleared as of now”. The application has been forwarded to the MEA, MHA, Reserve Bank of India and the Ministry of Shipping by the Commerce Ministry’s Department for Promotion of Industry and Internal Trade (DPIIT). When contacted, the Adani Group said that it was not involved in the applications process filed by its French partner. “We are not the applicant. We partner with CMA-CGM for the terminal in Mundra Port. We are the operator of the terminal as well as the port at Mundra port,” a senior official of the Adani group told The Hindu. “CMA-CGM is the third largest shipping company in the world and they are our partner in Mundra,” he said, adding that the permissions would have been sought in accordance with the requirements of Indian law. APSEZ, which is India’s largest private port operator, entered into the

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Indo-French joint venture with CMA Terminals for the Mundra port in 2014, and the container terminal at Mundra was commissioned in 2017. On December 20, 2019 CMA-CGM announced it was going to sell stakes in 10 terminals worldwide to its venture with China Merchants Group for $968 million. The list included the Mundra port in India, and others in China, Vietnam, Thailand, Singapore, Netherlands and other countries. Last week, the Nikkei Asian Review journal reported that two of the 10 terminals, including the ones in India and Vietnam, had held up the deal, quoting a CMG official who said that “because of the influence of the epidemic, as the examination and approval process of the local governments was delayed”. The MEA and the MHA declined to comment officially on the matter, and officials at the Shipping Ministry, which oversees ports, did not respond to calls. In 2017, intelligence agencies had flagged security concerns over the acquisition by Russian oil major Rosneft of the Essar refinery project, citing its proximity to Gujarat’s Vadinar port, military installations and Pakistan. The government cleared the project eventually, which was announced by Prime Minister Narendra Modi and Russian President Vladimir Putin as one of the biggest such deals. Despite the Adani Group’s considerable importance in the infrastructure business, however, it is unlikely the proposal for a Chinese stake in the Mundra port would be given swift clearance, said officials who did not wish to be named, citing the heightened tensions between Delhi and Beijing at present. As The Hindu had reported in July, about 200 investment proposals from China are awaiting security clearance from the MHA after new rules were notified in April, making prior government approval mandatory for foreign direct investment (FDI) from countries which share a land border with India. Adding to that, in the Mundra case, will be the fact that the China Merchant Group, a multinational state-owned corporation of the People’s Republic of China based in Hong Kong that operates in transport, finance and property sectors, took over Sri Lanka’s Hambantota port on a 99-year lease, amongst other Belt and Road Initiative (BRI) projects.

Source: The Hindu

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Container Update - October 2020 J. M. Baxi & CompanyPage 12

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