DP World investing $510m to build container port in India

DP World

Global ports operator DP World will invest $510 million to build, operate and maintain a new container terminal at the Kandla port in the Indian state of Gujarat, its group chairman said on Friday.

“It will enable the delivery of trade opportunities by connecting northern, western and central India with global markets,” Sultan Ahmed bin Sulayem, CEO of DP World, said after signing an agreement with the Deendayal Port Authority.

The new terminal, which should be completed by early 2027, will boost container traffic in India and reduce the cost of logistics. It will have a capacity of 2.19 million twenty-foot equivalent unit (TEU) per annum and a 1,100-metre berth capable of handling next-generation vessels carrying more than 18,000 TEUs.

As part of this concession agreement, the berth can be further extended to 1,375 metres.

The Deendayal Port Authority in January awarded the concession to develop a mega-container terminal to Hindustan Infralog Private Limited — a joint venture between DP World and state-owned National Investment and Infrastructure Fund.

The concession is on a build-operate-transfer (Bot) basis for a period of 30 years with the option to extend for another 20 years.

DP World currently operates five container terminals in India – two in Mumbai, one each in Mundra, Cochin and Chennai – with a combined capacity of approximately six million TEUs. With the addition of Tuna Tekra, DP World will have a combined capacity of 8.19 million TEUs.

DP World reported a drop in profits for the first six months of the year by almost 10 percent, despite revenues increasing by 14 percent.

Profit attributable to the UAE multinational logistics group in H1 was $651 million, down 9.7 percent compared to a record surplus of $721 million for the same period in 2022.

The near-term trade outlook was “uncertain” due to macroeconomic and geopolitical factors, bin Sulayem cautioned, but remained confident that the “solid financial performance of the first six months positions well to deliver a steady set of full-year results”.