Cargo Ships are docked at the Mumbai Port in India. (Photographer: Amit Bhargava/Bloomberg News)

Cargo Handled By Indian Ports Clocks Slowest Growth In Five Years

Cargo handled by Indian ports in the previous fiscal rose at its slowest pace in five years despite a sharp turnaround seen in oil & gas and container cargo in March.

Volume growth at India’s ports increased by just 3 percent in the 2018-19 financial year, below the long-term average growth rate of 4.5 percent, Goldman Sachs said in its report.

Ports across the country handled 699 million tonnes of cargo in FY19, according to a release by the Indian Ports Association. The lower growth rate, it said, was due to slowdown witnessed across categories such as iron ore, fertilisers and other miscellaneous cargo.

For the month of March 2019, port volumes saw a sharp turnaround after three months of decline due to the Chinese New Year and U.S.-China trade war tensions.

Volume growth in the month of March was mainly led by a pick-up in oil and gas related products. Container volumes also reported their highest growth rate in the last five months, thereby aiding volume growth.

Growth in oil and gas and container cargo was partially aided by a lower base, Goldman Sachs said in its report, adding that the continued volume growth will benefit Adani Ports and Special Economic Zone Ltd., Gujarat Pipavav Port Ltd. and Container Corporation of India Ltd.

Though the brokerage has a buy rating on Container Corporation of India, it did mention in its note that overall volume growth reported by the company for the last financial year was 8.4 percent which is below the management guidance of 10-12 percent.