Container firms to buy fewer rakes this fiscal

Major rail container operators have scaled down wagon procurement for this fiscal due to a slump in the domestic movement of goods through containers.

They are instead focusing on developing allied infrastructure such as logistics parks, terminals and Free Trade Warehousing Zones (FTWZ).

Companies including Arshiya International and Gateway Distriparks are contemplating leasing rakes to take advantage of excess capacity in the industry.

About 25 rakes are currently idled and available for leasing as various policy changes has rendered the in the domestic rail container space unviable for a couple of smaller private players.

For the state-run Container Corp of India (Concor), the major part of the procurement is a spillover of the last fiscal.

Concor plans to make a capital expenditure of Rs1,600 crore this fiscal, more than double the planned Rs700 crore in the last fiscal. However, the actual capex last fiscal was Rs350 crore.

The company plans to acquire 30 rakes this fiscal for `360 crore (Rs 12 crore a rake). The remaining `1,240 crore would be used or logistics parks, terminal development and other infrastructure.

“We plan to spend more than `1,600 crore in the current fiscal. Capex will be primarily for wagon acquisition and setting up some new PFT facilities (logistics parks) along the dedicated freight corridors and the Delhi Mumbai Industrial Corridor. We will spend money on land acquisition, terminal development, wagon and container acquisitions.   We plan to induct around 30 rakes and also import some rubber terminal gantry cranes),” said Anil Gupta, managing director, Concor.

In fiscal 2012, Concor had planned to procure 24 rakes, but acquired only seven due to a sluggish outlook in the domestic segment. The outstanding 17 rakes have been added to this year’s plan.

Gateway Railfreight, the rail subsidiary of Gateway Distriparks, has lined up capex of `120 crore this fiscal, mainly for development of new terminals and the existing
ones.

“We may look at procuring rakes in the second-half, but may look at leasing them,” said an official. The company has not decided on the number of rakes it would acquire.

 Arshiya International, a late-entrant in the private rail container space, plans a capex of around `1,200 crore to `1,400 crore this
fiscal.

The company plans to utilise these funds to fuel its second phase of expansion at its Mumbai and Khurja FTWZs.

On wagon procurement, Ajay Mittal, chairman and managing director, Arshiya International, said,” We have completed our first phase of wagon procurement for 20 rakes ( spread over two-and-a-half years time). We have not firmed up plans for the second phase, but could consider leasing.”