The union government's recent move to position the Shipping Corporation of India (SCI) as a strategic state carrier is a far cry from its earlier bid for privatisation. The shipping ministry plans to do this by capital infusion through a dedicated Maritime Development Fund, joint venture partnerships with major cargo operators, and fleet expansion programmes.
Shipping Secretary Vijay Kumar recently laid out plans for demand aggregation and scaling up SCI's tonnage capacity to address India's strategic maritime needs.
This also puts pressure on the Centre's original plan to divest more than 60 per cent stake in India's largest shipping company. Back in 2020, the Department of Investment and Public Asset Management (DIPAM) estimated that the disinvestment process would generate approximately Rs 3,000 crore in revenue. However, this plan has been repeatedly delayed over the past five years.
But the proverbial whale in the ocean is the shrinking profits of the Shipping Corporation of India, especially with it recently posting lacklustre quarterly earnings.
SCI second-quarter earnings slump
Standalone revenue from operations slid 7.73 per cent, falling to Rs 1,338.50 crore in Q2 FY26 from Rs 1,450.63 crore in Q2 FY25. This reduction in core business income put pressure on the overall earnings. Adding to the fall in revenue was the jump in total expenses, up 3.30 per cent, rising from Rs 1,193.51 crore to Rs 1,232.84 crore year-on-year.
But the line item "other expenses" stood out in the P&L statement, which dramatically jumped 7 times to Rs 116.73 crore in Q2 FY26 from Rs 16.10 crore in the same period last year.
Lower income and higher expenses evidently pulled the after-tax profit (PAT) for the period down, falling 39.40 per cent to Rs 175.89 crore. This translated into the basic Earnings Per Share (EPS) slumping from Rs 6.23 to Rs 3.78 apiece.
While there weren't many exceptional items in the reporting quarter, the 137 per cent jump in "other income" to around Rs 95 crore helped cushion the overall fall in revenue and profits.
During the quarter, SCI sold the vessel Maharshi Parshuram and took delivery of two Very Large Gas Carrier (VLGC) vessels, Sahyadri and Shivalik.
SCI's profit slump was a result of lacklustre performance across segments. The revenue from Liner segment fell by more than 28 per cent. The usually steady Tanker segment saw a minor 3 per cent decline in revenue.
Despite all this, investors are confident. The SCI stock has jumped 15 per cent year-on-year. Year to date, SCI is up by more than 24 per cent. But the numbers do not look too good, especially if it has to tow the line of Maritime India Vision 2030.