Dighi Port in talks with strategic, PE investors for port expansion

Mumbai: Dighi Port Ltd, which runs a port on the banks of Rajpuri creek in Maharashtra’s Raigad district, is in talks with private equity (PE) and strategic investors to raise about ₹ 200 crore for the port’s expansion, two people with direct knowledge of the development said.

This will be aided by IL&FS Transportation Networks Ltd, an investor in Dighi Port, looking to acquire an undisclosed stake in the port company’s road connectivity project.

Dighi Port’s earlier attempts at raising funds have suffered because of a lack of adequate connectivity.

Dighi Port, controlled by Mumbai-based Balaji Infra Projects Ltd, also has been undergoing a financial restructuring since December 2011 to recast loans worth ₹ 800 crore.

The firm is now looking to raise money to complete the first phase of port development, after which the total installed capacity of the port will be around 30 million tonnes.

“The promoters have already infused some money in accordance with the restructuring plan. The firm will raise about ₹ 200 crore from PE and strategic investors to fund the port’s expansion plans,” one of the persons mentioned above said, declining to be identified.

Dighi Port is in talks with leading port firms and PE firm Carlyle Group for fund-raising, he said.

A spokesperson at Carlyle declined to comment.

The second person mentioned above, also requesting anonymity, said prospective investors are keen on investing in the liquefied natural gas and container terminals and the liquid berth at Dighi Port.

Vishal V. Kalantri, a director at Dighi Port, confirmed his company is in talks with several potential investors but did not divulge details.

Kalantri said Dighi Port has emerged as the largest port in Maharashtra that’s not owned by the Union government. It handled more than four million tonnes of cargo in the last two years, and plans to invest about ₹ 1,000 crore for developing the port, over and above the ₹ 1,800 crore already spent, he said.

“IL&FS is actively participating in development of port, rail and road projects. The company (Dighi Port) has signed a memorandum of understanding with IL&FS Transportation Networks to develop rail and road network for optimum cargo evacuation,” Kalantri said, referring to the IL&FS unit picking up a stake in the port’s road connectivity project.

IL&FS Transportation Networks holds about 23% stake in Dighi Port.

Dighi Port has been trying to raise funds the past two years. A senior port consultant said the firm faced delays in raising funds as the port did not have road or rail connectivity.

“Now the pain points of the company are slowly getting over with the current debt restructuring. Once the port is connected well, there could be serious interest from several international port operators,” the consultant said, also requesting anonymity.

Dighi Port is the last and the largest node for the Delhi-Mumbai Industrial Corridor being jointly developed by the governments of India and Japan, which could add to interest in the project.

The port area has been identified as one of the seven mega national investment and manufacturing zones under the Indian government’s new manufacturing policy.

While Dighi Port has been under financial pressure, the uniqueness of the port is likely to attract large investors, the consultant quoted above said.

Under the first phase of expansion, the port is developing five multipurpose berths and will offer an alongside depth of 14.5m.

“Two multipurpose berths having a single quay length of 650m (the longest such in Maharashtra) have been developed and are operational on the south bank. The north bank will offer three multipurpose berths having a total quay length of 1,100m,” Kalantri said.