TATA Steel and Larsen & Toubro have pledged 51% stake of their joint venture, Dhamra Port Company.

TATA Steel which has 50% stake in DPCL, has said in its annual report said that "The promoters' combined investments in DPCL representing 51% of the port's paid up equity share capital are pledged with IDBI Trusteeship Services.”

The financial details of the pledge were not disclosed.

IDBI Trusteeship Services which claims to be the country's largest trusteeship firm, is jointly promoted by IDBI Bank, Life Insurance Corporation and GIC of India.

Generally, promoters' pledge their shares as a security to borrow money from financial institutions. The funds so raised could be used for either personal needs or business expansion.

Meanwhile, in its annual report, L&T, which owns the rest 50% stake in DPCL, said the Port, in its first year of operation, suffered a loss of Rs 458 crore on high interest cost and amortisation.

L&T said that "DPCL reported a total income of INR 198 crore for FY'12 with a net loss of INR 458 crore. As this was the first year of operations for the port, it had high amortisation and interest costs along with initial ramp up in traffic.”

Since commencing operations in May last year, the port handled a total of 5.1 million tonnes cargo. Presently, two berths of the port have been fully developed.

The two home grown corporate giants joined hands to form a 50:50 joint venture for setting up a deep water all weather port at Dhamra, under Build-Own-Operate-Share-Transfer model with a concession awarded by the Odisha Government for a period of 34 years with an option for renewal.

Source - Money Control

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