February 20, 2008 / 11:03 AM / 11 years ago

India Cochin Shipyard seeks govt OK for IPO-source

(For India IPO diary and data, click on <IN/IPOMENU>)

MUMBAI, Feb 20 (Reuters) - Indian state-owned Cochin Shipyard Ltd is awaiting government approval for an initial public offering to help raise funds for building a new dock and meet rising demand for ships, a company source said on Wednesday.

“We submitted a proposal to the government last month,” the senior official, who did not want to be identified, told Reuters.

Another company official also confirmed the plan but declined to give details of how much the company, which can build ships up to 110,000 dead weight tonnage at its yard in the southern state of Kerala, aimed to raise in the IPO.

There are 32 shipyards in India, including seven owned by the government, while a jump in demand for ships has brought many private companies into the fray.

Consultants KPMG said in a report last year that the shipbuilding industry in India was expected to invest about 185 billion rupees ($4.6 billion) over seven years for capacity expansion and new yards.

Pipavav Shipyard, a private-sector yard co-founded by by Indian engineering and construction firm Punj Lloyd (PUJL.BO), is awaiting the market regulator’s approval for an estimated 12.5 billion rupees IPO.

Other firms such as ABG Shipyard (ABGS.BO) and Bharati Shipyard (BHAR.BO) are also expanding, with annual industry sales expected to reach $20 billion by 2020 from about $5 billion, i-maritime Consultancy Pvt Ltd said. ($1 = 40.1 Indian rupees) (Reporting by Arpan Mukherjee; Editing by Ramya Venugopal)

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