Recently, the Indian government announced its plan to sell a 4.83% stake in Mazagon Dock Shipbuilders (MDL), according to Reuters. Currently, the Government of India owns 84.83% of the shipyard and plans to sell 11.4 million shares, or 2.83% of its current holding, with an option to sell a further 2%.
MDL said the floor price for the sale was 2,525 rupees per share, a discount of nearly 8% to its closing price on April 3. MDL’s shares have risen nearly 23% so far this year.
MDL is understood to be moving ahead with its shipyard expansion plans and has awarded a contract worth about 9 million euros to Dutch engineering firm Royal HaskoningDHV to provide design and project management services for the expansion of its yards in Mumbai. Under the contract, Royal HaskoningDHV will support MDL’s expansion program, including shipyard planning, geotechnical and environmental investigations, detailed engineering design, as well as procurement consultancy services and project supervision.
Royal HaskoningDHV will support MDL’s expansion program, including shipyard planning, geotechnical and environmental investigations, detailed engineering design, as well as procurement consulting services and project oversight.
The larger of the two shipyards is the Nhava Shipyard, a 16-hectare shipyard located across the channel from MDL’s existing shipyard. The yard will have up to 30 buildings such as dry berths, fabrication facilities, workshops, warehouses, utilities, plant and machinery. In addition, the shipyard will be equipped with a huge dry dock, expected to be nearly 600 meters long and 60 meters wide, capable of accommodating large ships, suitable for the construction and repair of aircraft carriers as well as the largest Suezmax oil tankers and bulk carriers.The Nhava Shipyard, which will be used for the construction and repair of both defense and commercial vessels, is expected to create about 1,500 new jobs.
The other shipyard, known as South Yard Annex, is smaller and adjacent to the existing MDL shipyard. This shipyard will be used equally for shipbuilding and ship repair and will be equipped with a wet-cum-dry dock, a rigid slipway and a waterfront jetty with ro-ro/unloading facilities for loading and unloading of ships via floating docks, barges or submersibles. The yard houses ex-British built repair facilities, which has been leased by MDL from the Mumbai Port Authority for 30 years. The shipyard is expected to create about 500 new jobs.
The new shipyards will make use of solar energy and natural light and adhere to the standards of the Indian Green Building Council. The design phase will last 18 months, construction of the Nhava shipyard will take a further 48 months, and construction of the South Yard Annex will take 36 months.
In addition, the construction of the two new shipyards will support the shipyards by spurring the development of related ancillary industries and micro, small and medium-sized enterprises (MSMEs), covering a wide range of sectors from technology start-ups to steel manufacturing.