JSW Infra hits record high on winning ₹4,119-cr contract to build Keni Port

Shares of JSW Infrastructure Ltd surged 7.8% in the opening trade on Friday after the commercial port major said it has won a contract worth ₹4,119 crore to develop Keni Port in Karnataka.

JSW Infrastructure, in a stock exchange filing today, said it has won the bid for the development of an all-weather, deep-water, greenfield port at Keni in Karnataka on public public-private partnership basis. To carry out the project, the Karnataka Maritime Board has now issued the letter of award (LOA) to the firm. As per the document, the estimated cost of the project is ₹4,119 crore, with an initial capacity of 30 million tonnes per annum, with further potential to increase substantially in the long run.

Arun Maheshwari, joint MD and CEO of JSW Infrastructure, said the company is partnering with the Karnataka Government’s mission to meet the logistics demand of a rapidly growing state and the region’s economy. “Once developed, the Keni port is expected to crucially address the rising import and export trade momentum of the region.”

The proposed Keni Port will have modern environment-friendly mechanised facilities for handling cape-size vessels. It is envisaged to handle all types of cargo on the west coast in the North Karnataka region to serve the industries in the area covering Bellary, Hosapete, Hubballi, Kalaburagi and South Maharashtra. 

Explaining the rationale behind the deal, the company says the proposed Keni Port is located strategically between two operational Major Ports -- Mormugao Port in the north and New Mangalore Port in the south. 

“The proposed port’s hinterland is primarily of coal and coke cargo, which is being utilised for steel, cement and power plants. It is also further supported by iron ore, limestone, dolomite handlings and the export of finished steel products. Rail connectivity to the Keni Port site is proposed to be on the southern side and will be connected with the existing Konkan line to the north of the Ankola Station. The proposed railway alignment will be developed with a total length of approximately 8 km. The proposed port will be well connected with Road and Railway Connectivity.” 

As per the Karnataka Maritime Perspective Plan, Karnataka is currently having a hinterland potential of 44 MTPA of cargo and the same is expected to increase to 117 MTPA by 2035. 

The stock opened a gap-up at ₹217.7 and surged to an intra-day high of ₹220 in the early morning trade on the BSE, hitting a fresh record high. At the current share price of ₹202.80, the market cap of the infra company stands at ₹44,730 crore. Shares of JSW Infra have surged 5.2% in the past week; 20.51% in the past month; and 35.51% in the past six months.

JSW Infra had launched its IPO in September 2023, which was the first by Sajjan Jindal-led JSW Group’s in nearly 13 years. The public offer of the ports business of JSW Group was a fresh issue of 23.53 crore shares.

On the financial front, the company posted a 126.8% growth in net profit at ₹749.5 crore for the financial year ended March 2023 (FY23) as compared to ₹330.44 crore in the last fiscal (FY22). The revenue from operations jumped 41.7% to ₹3,372.85 crore versus ₹2,378.74 crore in the year-ago period.

Established in 2006, JSW Infrastructure provides maritime-related services such as cargo handling, storage solutions, and logistics support services. Sajjan Jindal Family Trust owns a 90.91% stake in the port-related infrastructure company, while JSW Infrastructure Employees Welfare Trust, JSL, and Siddeshwari Tradex hold the remaining 9.08% shares in the firm. Post listing, promoters’ stake in the company will come down to 85.62%.