The Great Eastern Shipping Co. Ltd.

Business & Financial Review

February 2016

Forward Looking Statements

Except for historical information, the statements made in this presentation
constitute forward looking statements. These include statements regarding the
intent, belief or current expectations of GE Shipping and its management
regarding the Companys operations, strategic directions, prospects and future
results which in turn involve certain risks and uncertainties.
Certain factors may cause actual results to differ materially from those contained
in the forward looking statements; including changes in freight rates; global
economic and business conditions; effects of competition and technological
developments; changes in laws and regulations; difficulties in achieving cost
savings; currency, fuel price and interest rate fluctuations etc.
The Company assumes no responsibility with regard to publicly amending,
modifying or revising the statements based on any subsequent developments,
information or events that may occur.
2

Corporate Profile
The Great Eastern Shipping Company

Offshore
Shipping (Bulk)

(Through wholly-owned subsidiary

Greatship (India) Limited)

Tankers
- Crude
- Products

Bulk

Logistics

Drilling

Indias largest private sector shipping company.

Over 67 years of experience

Uninterrupted dividend for 30 years

Dividend per share (Rs)

Dividend Payout Ratio (%) (RHS)

16

100
90
80
70
60
50
40
30
20
10
0

14
12
10
8
6
4
2
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
1990-91
1991-92
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-99
1999-00
2000-01
2001-02
2002-03
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2013-14
2014-15

Interim dividend of Rs. 6 per share announced in Q3 2015-16

* Dividend payout calculated basis standalone nos.

Shareholding Pattern
Shareholding Pattern as on December 31, 2015

Public
21%
Corporate
Bodies
6%
Govt/FI
20%

Promoters
30%

FII
23%

Shipping business - owned fleet

Sr. No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21

Vessel Name
Type
Jag Lalit
Suezmax
Jag Lok
Suezmax
Jag Lateef
Suezmax
Jag Lakshita
Suezmax
Jag Lyall
Aframax
Jag Lata
Aframax
Jag Laxmi
Aframax
Jag Lavanya
Aframax
8 Crude Carriers ; Average Age - 13 years
Jag Aabha
LR1
Jag Aanchal
LR1
Jag Amisha
LR1
Jag Aparna
LR1
Jag Pahel
MR
Jag Pankhi
MR
Jag Prabha
MR
Jag Prakash
MR
Jag Pushpa
MR
Jag Prerana
MR
Jag Pranav
MR
Jag Pranam
MR
Jag Padma
MR
13 Product Carriers; Average Age - 9.5 years

Sr. No.
Vessel Name
Type
22
Jag Vishnu
VLGC
1 Gas Carrier; Age - 22 years
23
Jag Aarati
Kamsarmax
24
Jag Aditi
Kamsarmax
25
Jag Arya
Kamsarmax
26
Jag Arnav
Kamsarmax
27
Jag Ratan
Supramax
28
Jag Rahul
Supramax
29
Jag Rishi
Supramax
30
Jag Rani
Supramax
31
Jag Roopa
Supramax
9 Bulk Carriers; Average Age - 6.5 years

31 Vessels
Average Age - 10.6 years
Total dwt - 2.4 mn

Vessels on Order & Capital Expenditure

Vessels on Order & Expected Delivery
Vessel

Yard

Expected Delivery

1 Medium Range
Product Tanker

STX Group

Q4 FY16

3 Kamsarmax Dry Bulk

Carriers

Jiangsu New Yangzi

Shipbuilding Co. Ltd,
China

Q1 FY17, Q3 FY17 &

Q4 FY18

Committed Capex & Payment Schedule

Committed Capex - $120 mn
Paid till
2014-15

Paid YTD
2015-16

(To be paid)
2015-16

(To be paid)
2016-17

(To be paid)
2017-18

$16 mn

$22 mn

$20 mn

$44 mn

$18 mn

Tankers Asset Prices (5-year old)

USD mn

VLCC

Suezmax

MR

2011

2012

2013

2014

2015

90.00
USD mn

180
80.00
160
70.00

140
120

60.00

100

50.00

80

40.00

60

30.00

40
20.00
20
10.00
2001-01
2001-12
2002-11
2003-10
2004-09
2005-08
2006-07
2007-06
2008-05
2009-04
2010-03
2011-02
2012-01
2012-12
2013-11
2014-10
2015-09

0.00
VLCC

Suezmax

MR

Source Industry Reports

Bulkers Asset Prices (5-year old)

Capesize

Panamax

Supramax

2011
50.00

USD mn
180

2012

2013

2014

2015

USD mn

45.00

160

40.00

140
35.00

120

30.00

100
80

25.00

60

20.00

40

15.00

20

10.00
2001-01
2001-12
2002-11
2003-10
2004-09
2005-08
2006-07
2007-06
2008-05
2009-04
2010-03
2011-02
2012-01
2012-12
2013-11
2014-10
2015-09

5.00
0.00
Capesize

Panamax

Supramax

Dry Bulk asset prices at 20-year low

Source Industry Reports

Low oil prices positively impacted tanker rates

Jan-16

Oct-15

Jul-15

Apr-15

Jan-15

Oct-14

Jul-14

Apr-14

Jan-14

Oct-13

Jul-13

Jan-13

Jan-16

Oct-15

400
Jul-15

400
Apr-15

500
Jan-15

600
Oct-14

600

Jul-14

800

Apr-14

700

Jan-14

1,000

Oct-13

800

Jul-13

1,200

Apr-13

900

Jan-13

1,400

Apr-13

Baltic Exchange Clean Tanker

Index

Baltic Exchange Dirty Tanker

Index

Lower crude oil prices Higher demand for end-products, esp. Gasoline

Crude Surplus SPR and commercial storage of crude, floating storage

Refinery runs exceeding demand More product movement, storage on tanks, forced
storage on vessels

Countries focusing on diversifying import sources leading to longer voyages

Source Industry Reports

10

Lower oil prices, leading to increased demand & refinery

runs
Global Refinery Crude Throughput y-o-y change (mbpd)
Oil demand y-o-y change (mbpd)
Oil Prices ($/bbl)

mbpd

$/bbl

3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
-0.5
-1.0
-1.5

130
120
110
100
90
80
70
60
50
Q4 2015

Q3 2015

Q2 2015

Q1 2015

Q4 2014

Q3 2014

Q2 2014

Q1 2014

Q4 2013

Q3 2013

Q2 2013

Q1 2013

Q4 2012

Q3 2012

Q2 2012

Q1 2012

Q4 2011

Q3 2011

Q2 2011

Q1 2011

Q4 2010

Q3 2010

Q2 2010

40

Source Industry Reports

11

Healthy refinery margins on account of high gasoline

demand
Europe Refining Margins

Asia Refining Margins

12
10
8
6
4.83
4
4.78
2
0

Brent-Rotterdam Margins

5yr Median

10.10

Dubai-Singapore Margins

Jan-16

Mar-15

May-14

Jul-13

Sep-12

Nov-11

Jan-11

Mar-10

May-09

Jul-08

Sep-07

Nov-06

7.02

Jan-06

Jan-06
Jul-06
Jan-07
Jul-07
Jan-08
Jul-08
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
Jul-11
Jan-12
Jul-12
Jan-13
Jul-13
Jan-14
Jul-14
Jan-15
Jul-15
Jan-16

14
12
10
8
6
4
2
0
-2

5yr Median

High refinery margins, supported by strong gasoline cracks

Middle Distillate demand is softer leading to storage on tanks,
forced storage on vessels
Source Industry Reports

12

Rising Product exports from Middle East

New export-oriented refineries leading to increased trade
Naphtha

kbpd

Motor and aviation gasoline

Kerosenes

Gas/diesel oil

1200
1000
800
600
400
200

Nov2015

Sep2015

Jul2015

May2015

Mar2015

Jan2015

Nov2014

Sep2014

Jul2014

May2014

Mar2014

Jan2014

Nov2013

Sep2013

Jul2013

May2013

Mar2013

Jan2013

Source Industry Reports

13

Rising Naphtha imports from West to Asia supporting LRs

Asian Naphtha Imports by Source
3,500

Asian Naphtha Imports - Market Share

100%

kt

8%
90%

3,000

15%

23%

30%

29%

26%

24%

46%

45%

48%

2013

2014

2015

80%
2,500

70%

40%

34%
31%

60%

2,000

50%

1,500

40%
1,000

30%
52%

51%

2011

2012

20%

500

10%
Jan-08
Jul-08
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
Jul-11
Jan-12
Jul-12
Jan-13
Jul-13
Jan-14
Jul-14
Jan-15
Jul-15

Middle East

Asia

West

0%
ME Share

Asia Share

West Share
14

Source Industry Reports

14

Baltic Dry Index (Jan 2000 Jan 2016)

Dry Bulk freight rates continued to plummet

BDI

Jan-00
Jul-00
Jan-01
Jul-01
Jan-02
Jul-02
Jan-03
Jul-03
Jan-04
Jul-04
Jan-05
Jul-05
Jan-06
Jul-06
Jan-07
Jul-07
Jan-08
Jul-08
Jan-09
Jul-09
Jan-10
Jul-10
Jan-11
Jul-11
Jan-12
Jul-12
Jan-13
Jul-13
Jan-14
Jul-14
Jan-15
Jul-15
Jan-16

14000
12000
10000
8000
6000
4000
2000
0

China slowdown leading to sharp moderation in iron ore imports

Emphasis on environment leading to lower coal usage, sharp
decline in coal imports
Source Industry Reports

15

Moderation in Chinas import growth, increase in shorthaul trade

Steel Production fell in 2015
World
Growth in World Production (RHS)

China
Growth in China Production (RHS)
15%

2000
mt
1500

10%

1000

5%

500

0%

-5%
2013

2014

2015

China Iron Ore Imports (Source-wise)

Australia

Brazil

Others

Market Share - Australia (RHS)

Market Share - Brazil (RHS)

Market Share - Others (RHS)

1500
Growth 13.8%

mt

Growth 2.3%

70%

1000
50%
500

30%

10%
2012

2013

2014

2015

Source Industry Reports

16

Coal imports by top importers on a declining trend

China coal imports
mt

India coal imports

Chinese Coal imports 2015 YoY

Growth

mt

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

10

0.0
-2.0

-1.4

-4.0

6.5
6
-4.8

-6.0
-6.0
-7.3 -7.6

4.3
4

-6.9

-10.0

8.9

-0.9
-3.4

-8.0

Indian Coal Imports - 2015 YoY

Growth

2.1
-8.1

2.9 2.6

-9.3
0

-12.0
-14.0

-2

-16.0

-4

-0.6

-1.1 -0.7
-4.0

-18.0
-18.2
-20.0

-3.9

-6
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov

Source Industry Reports

17

World Fleet Growth

Fleet
1000
Dry Bulk

800

Crude

Product

Mn.dwt

600
400
200
0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Fleet
Gross Fleet Addition

Feb 16

CY2016

CY2017

CY2018+

(in mn dwt)
Crude tankers

338.3

8%

8%

3%

Product tankers

142.5

10%

8%

3%

Dry bulk carriers

778.8

11%

3%

1%

Source Industry Reports

18

Accelerated scrapping in Dry Bulk

Scrapping as % of world fleet (year-wise)
Vessel Category

Fleet as on
Feb 16

Scrapping
2015

(in mn dwt)

2014

2013

(% of beginning fleet)

Crude

338.3

0.2%

1%

2%

Product

142.5

0.2%

1%

2%

Bulk

778.8

4%

2%

3%

Source Industry Reports

19

Market Trends in brief

Tankers

Dry Bulk

Low oil prices, high demand

Decline in Chinas steel production, iron

ore import dependency already at higher
levels

Healthy refining margins & runs

China Coal imports declining Govts

focus on pollution control, renewables

SPR, commercial storage & floating

storage

Increase in Indias domestic coal

production

Diversification of import sources, new

export-oriented refineries altering
ton-mile

Stimulus measures by China

Risk of demand slowdown

Change in OPECs stance
Expected increase in tanker supply

Continued scrapping, slippage, lower

ordering & delaying delivery of vessels
from yards

20

Greatship (India) Limited

(a 100% subsidiary)

Business Review
February 2016

Offshore business- Fleet Profile

The Greatship Group

Current Owned Fleet

4 Jack Up Rigs (350ft)

5 Platform Supply Vessels (PSV)

8 Anchor Handling Tug cum Supply

Vessels (AHTSV)

High Fleet Utilization

2 Multipurpose Platform Supply and

Support Vessels (MPSSV)

6 Platform / ROV Support Vessels

(ROVSV)

Category

Extent of coverage of
fleet's operating days
(per cent)
(Q4FY16)

PSV

74

ROVSV

83

AHTSV

92

MPSSV

Jackup Rigs

91

22

Greatships Modern & Technologically Advanced Fleet & High

Utilization

Young Fleet
Young jack-up fleet with an average age
of approx. 4.5 years
Demand shifting to modern vessels,
especially as safety becomes a major
concern for oil companies

Revenue
Efficiencies

- Higher utilization rates

- Minimum down time

Technologically Advanced
Specialized/technologically advanced
vessels equipped with DP I/DP II
(Dynamic Positioning) and FiFi I (Fire
Fighting) technologies
Equipped to operate in challenging
environments

- Lower Operating costs

Cost
Efficiencies

- Reduced maintenance
capex & opex

Efficient and versatile vessels

23

Double-digit decline in capex spending in 2016

2 years of continuous decline in capex spending

Source Industry Reports

24

Global Fleet Supply Offshore

Fleet & Orderbook
(Nos)

Jackup Rigs

AHTSVs

PSV

Current Fleet

484

1913

1428

Orderbook

129

207

261

% of O/B to current
fleet

25%

13%

18%

Actual deliveries much lower than estimated deliveries in 2015. Trend is

likely to continue in 2016

Jack-up utilisation has dropped to 70% or lower from ~90% at the start
of 2014 while roughly 40-50% of AHTSVs and PSVs are idle/stacked or
working spot

Source: Rigzone, Marinebase, Industry Reports

25

FINANCIAL HIGHLIGHTS
Q3 FY 2015-16

Q3 FY 2015-16 Financial Highlights

Key Figures

Standalone

Q3FY'16

Q3FY'15

9MFY'16

533
245
102

513
207
69

1,720
903
514

(Amount in Rs. crs)

Income Statement
Revenue (including other income)
EBITDA (including other income)
Net Profit

9,536
5,392
2,816
(233)

298
(319)
(143)
(164)

9,418
5,013
3,153
511

201
(360)
(92)
(251)

Consolidated

Q3FY'16

Q3FY'15

9MFY'16

995
556
275

944
407
182

3,110
1,786
981

9,536
5,392
2,816
(233)

Balance Sheet
Total Assets
Equity
Total Debt (Gross)
Long Term Debt (Net of Cash)

16,044
8,544
5,966
1,843

15,111
7,480
6,153
2,669

16,044
8,544
5,966
1,843

688
(676)
(556)
(545)

Cash Flow
From operating activities
From investing activities
From financing activities
Net cash inflow/(outflow)

625
(422)
(311)
(108)

442
(540)
(3)
(101)

1,519
(969)
(1,170)
(620)

27

Q3 FY 2015-16 Financial Highlights

Key Figures

Standalone

Consolidated

Q3FY'16

Q3FY'15

9MFY'16

(Amount in Rs. crs)

Key financial figures

Q3FY'16

Q3FY'15

9MFY'16

45.96%

40.37%

52.51%

EBITDA Margin (%)

55.91%

43.09%

57.43%

7.68%

5.55%

13.27%

Return on Equity (ROE) (%)

13.12%

9.87%

16.38%

7.18%

5.76%

10.67%

Return on Capital Employed (ROCE) (%)

9.55%

7.52%

11.19%

0.52

0.63

0.52

Gross Debt/Equity Ratio (x)

0.70

0.82

0.70

(0.04)

0.10

(0.04)

Net Debt/Equity Ratio (x)

0.22

0.36

0.22

65.85

61.87

64.56

Exchange rate USD/INR, average (Rs)

65.85

61.87

64.56

66.15

63.04

66.15

66.15

63.04

66.15

Exchange rate USD/INR, end of period (Rs)

Share related figures

6.79

4.58

34.07

Earnings per share, EPS (Rs)

18.23

12.05

65.08

6.77

4.57

34.01

Diluted earnings per share (Rs)

18.19

12.03

64.95

13.19
6.00

10.25
-

50.88
6.00

Cash Profit per share (Rs)

30.44
6.00

22.54
-

99.05
6.00

Dividend per share (Rs)

28

Q3 FY 2015-16 Performance Highlights

Breakup of revenue days
Q3FY16 Q3FY15

Revenue Days
Owned Tonnage
Inchartered Tonnage
Total Revenue Days

2,593
115
2,708

2,547
0
2,547

Total Owned Tonnage (mn.dwt)*

2.36

2.45

* As on 31st December

Mix of Spot & Time

Days (in %)

Q3FY16 Q3FY15

Dry Bulk

Average TCY Details

Spot %

Average (TCY $ per day) Q3FY16 Q3FY15 % Chg

Time %

92%
8%

85%
15%

73%
27%

80%
20%

78%
22%

80%
20%

Tankers

Crude Carriers

30,767

19,237

59.9%

Spot %

Product Carriers (Incl. Gas)

24,092

24,061

0.1%

Time %

Dry Bulk

6,320

10,772

(41.3)%

Total
Spot %
Time %

29

THANK YOU
visit us at www.greatship.com