Gujarat Pipavav Port - Rate Card: Ups Tariffs on Expected Lines; Event Update :: Edelweiss, link

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Gujarat Pipavav Port (GPPL) has revised tariffs across container handling services in the 6-15% range, but has largely maintained marine and bulk handling charges. The hike’s average impact on customers could be in the ~4-5% range and will be effective January 2015. In our view, the recent 27% increase in haulage charges for container volumes and 10% congestion surcharge on import volumes coupled with the current tariff hike could hurt Exim volumes in the near term amidst capacity constraints.

Tariff revision comes after a miss in CY14

GPPL has revised port tariffs effective January 1, 2015. The company had refrained from increasing tariffs in CY14 (last hike was in August 2013) owing to weak container market due to prolonged slowdown in European markets. Terminal handling charges for non-empty road containers have been raised ~6% (both 20ft and 40ft containers) and those for non-empty rail containers ~14%; port infrastructure development fee of USD6 for 20ft and USD12 for 40ft containers are maintained. However, marine charges (includes port dues, pilotage, berth hire charges, etc.,) have not been changed. Since ~75% of volume comprises containers (35%:65% road:rail split), we estimate the total increase to be ~8%. However, the company stated that the increase could be only ~4-5% as most of the tariffs are negotiated with liners. Post the proposed tariff revision, though container tariff for the road segment is in line with market rates, rail segment rates continue to be competitive.

Indian Railways hikes haulage charges; import surcharge introduced

The hike in rail haulage charges will benefit road transport for distances up to 500km. For most of GPPL customers who transport cargo over longer distances, rail remains viable despite the increase in charges, though some impact will be seen in the near term.

LINK
https://www.edelweiss.in/research/Gujarat-Pipavav-Port--Rate-Card-Ups-Tariffs-on-Expected-Lines;-Event-Update/27742.html