National carrier Shipping Corporation of India (SCI), which has suffered three consecutive years of losses, but returned to profitability earlier this year, has finally lifted a freeze on ship acquisition.

The government-owned shipping line is planning investment of INR8bn (US$130m) on the purchase of two second-hand liquefied petroleum gas (LPG) carriers and a couple of offshore supply vessels.

"This will be our first vessel purchases in over three years," said SCI's chairman and managing director Arun Kumar Gupta.

"We would like to induct the LPG carriers into our fleet before the end of the current calendar year. It will take a little longer for us to get the two offshore vessels, which will be newbuildings at Cochin Shipyard (another state-run facility)."

The acquisitions will be funded through equity of INR3bn and debt of INR5bn. The company intends to utilize the INR3.15bn proceeds of its FPO for the equity.
SCI has also scrapped its earlier plan of exiting the loss-making container shipping business. Instead, it is now deploying its container vessels for carrying coastal cargo, an area in which it is still strong.

"We have five container vessels, and this segment is a huge challenge for us," said Gupta. "We are now trying to see how to deploy these large vessels for coastal shipping."