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PSL aims to double fleet by mid-2014

Monday, 20 February 2012 | 00:00
Precious Shipping Plc (PSL), the country's largest dry-bulk carrier by market value, plans to more than double its fleet from 26 ships now to 60 by mid-2014 amid projections that the shipping industry will bounce back next year.
The SET-listed company this year will take delivery of four Chinese-made ships plus at least three from the ABG Shipyard in India, said managing director Khalid Hashim.
PSL has experienced delays with all of the ships being built by ABG and has sold five of the 18 vessels it had ordered from the Indian shipyard.
"Right now we still have a balance of 12 shipbuilding contracts at ABG and four in China. If all of these 16 are built on time and we don't need to sell or cancel any of them, then we will get 16 brand-new ships for about US$490 million," he said.
Delivery of these ships would be spread over 2012, 2013 and part of 2014, he said.
PSL is also looking for as many as 20 second-hand ships but it has no specific timeframe for the purchases, which will depend on prevailing market prices.
"If prices keep dropping to the levels that we've managed to buy _ for example a 30,000-tonne ship built in 2009 for $17.75 million _ then we would be happy to buy as many ships as are available," said Mr Hashim.
The company expects the second-hand vessels to cost between $15 million and $20 million each of $300-400 million in total. "We have stated that our total fleet strength target is to have between 60 and 70 ships within the next 12 to 24 months," he said.
Industry observers believe the shipping business has bottomed out and is ready to rally. They note that the Baltic Dry Index (BDI) has fallen to 662 points, one point lower than after the Lehman Brothers collapse in late 2008.
The BDI, a measure of shipping costs for dry-bulk a commodities, is expected to remain lower than 800 points in the near term, but it will bounce back and stay between 800 and 1,500 points for the rest of the year.
PSL shares closed yesterday on the SET at 16.70 baht, up 20 satang, in trade worth 26.2 million baht.
Source: Bangkok Post
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