The net profit growth excludes the profit of Rs 22.03 crore earned on the sale of ships. During the year under review, the company made a loss of Rs 2.27 crore from the sale of ships.

Essar Shipping reduced its operating expenses by 3 per cent to Rs 185.72 crore, while interest and finance charges have declined by 22 per cent to Rs 73.27 crore. About 41 per cent of the company's income, Rs 175.16 crore, was earned in foreign exchange.

The shipping industry faced a weak dry cargo market, with freight rates dropping by almost 30 per cent. Ship values have also fallen significantly during the year, shrinking the market for ships. According to the release, returns onmost ships have turned negative and the company has curtailed operations in the sector.

Essar Shipping has a Rs 1,435-crore port facility under construction at Vadinar for its refinery at Jamnagar. This includes a state-of-the-art Single Buoy Mooring (SBM) terminal, a POL handling terminal, pipelines, and road and rail links. The port has a capacity to handle 20 million tonnes of crude and 14 million tonnes of petro products.

According to a release, the SBM is under erection and the port is expected to be commissioned by the first half of 2000.