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SAIF Powertec, the country’s leading terminal operator handling around 60 per cent of containers at the Chattogram seaport, is now implementing more business plans to take it to new heights.
In March this year, SAIF Powertec reached an agreement with Safeen Feeders, a subsidiary of Abu Dhabi Ports Company PJSC to operate eight bulk carrier vessels for shipping dry bulk cargoes from Fujairah Port to Chittagong Port, according to an equity note prepared by EBL Securities, a stockbroker.
Later in September, the publicly traded company entered into another contract with Safeen Feeders to operate three container vessels transporting containers from the UAE to Bangladesh.
Saif Maritime LLC, a Dubai-based subsidiary of Saif Powertec Limited, would charter the container vessels for a contract period of 15 years.
The company recently acquired a 100 per cent stake in Saif Maritime LLC by investing Tk 1.26 crore from which it expects to generate an estimated annual revenue of Tk 25.98 crore and a net profit of Tk 3.89 crore, the EBL Securities stated.
Incorporated in 2003, Saif Powertec went public in 2014.
The company now operates the Chittagong container terminal and the New Mooring container terminal for the Chittagong Port Authority. It has been providing infrastructure support services as well.
The company also acts as a backup container-handling operator at Pangaon Inland Container Terminal and Kamlapur Inland Container Depot.
Moreover, it is also heavily involved in the import, trade, assembling, and installing of generators, substations, electrical equipment, and gridlines, as well as installing or establishing power plants.
The listed company generates a significant portion of its revenue from its port and terminal operation contracts.
Saif Logistics Alliance, a subsidiary of Saif Powertec, signed an agreement with the Container Company of Bangladesh Limited (CCBL), a subsidiary of Bangladesh Railway in October last year to build a multimodal container depot at Halishahar near the Chattogram Port Railway Yard with an estimated cost of Tk 308 crore.
This project was expected to generate Tk 3,482 crore in revenue and Tk 649 crore in net profit in the following 20 years since the start of its commercial operation, EBL Securities stated.
Saif Powertec posted a Tk 62.63 crore in net profit for the fiscal year 2020–21, which was 61.37 per cent higher than that of the previous year.
In the last five years, the company consistently paid dividends of at least 10 per cent each year.
The terminal operator also established an IT-based subsidiary – 88 Innovations Engineering Limited – where it decided to invest 55 per cent of the total equity of the company, according to the EBL equity note.
With an estimated project cost of Tk 75 crore, it expects to generate an annual revenue and net profit of Tk 100 crore and Tk 24 crore respectively from it, the equity note read.
The listed company also planned to expand its operations into gas and oil exploration with Uzbekistan’s Ariel Service & Support by investing around Tk 473 crore.
According to the EBL documents, this project was expected to generate Tk 516 crore of revenue and Tk 86 crore of net profit per year.
EBL Securities also said the Bangladesh Inland Container Depots Association (BICDA) recently increased the charges for handling export-laden containers by 25 per cent and import-laden containers by 35 per cent on August this year.
Since the company handles around 60 per cent of containers at the Chittagong seaport, this rise in ICD charges would produce inflated revenue for the company.
According to the equity note, the company’s revenue was expected to decline by 16.1 percent for the first nine months (July-March) of the fiscal year 2021-22 owing to a slowdown in port operations caused by a significant decline in export and import operations amid the macroeconomic strains including the domestic currency depreciation, depletion of the foreign currency reserve, and rising fuel costs.
With a capitalisation of Tk 1,126 crore the listed company has a paid-up capital worth Tk 379 crore. It also has Tk 135 crore as surplus reserves.
Saif Powertec shares were traded at Tk 29.7 per share on the trading floor of the DSE on Thursday.
