Shipping Corp says war in Ukraine needs to abate for stake sale to move

Shipping Corp. of India Ltd.’s proposed privatization may need to wait until the market turbulence triggered by Russia’s invasion of Ukraine blows over and investors regain confidence.

“Globally markets are facing impact of the crisis, I don’t think this is the right opportune moment,” Shipping Corp. Chairperson and Managing Director Harjeet Kaur Joshi said in an interview to Bloomberg Television on Tuesday. The performance of the market will “majorly” drive the timing for the divestment, she said, adding that is not the government’s view.

The war in Ukraine is sparking supply crunch concerns as Russia is a key supplier of energy, metals and crops. Moves to isolate Moscow has led to a surge in commodities prices from crude, nickel to aluminum and wheat. Oil freight transportation costs from Russian ports are surging as shipowners avoid business with the nation. Over a thousand seafarers and about hundred ships are stranded near Ukraine as the war shut ports.

The war hasn’t affected Shipping Corp.’s operations as Indian refiners buy very little crude from Russia, Joshi said. The deadline for financial bids for privatizing Shipping Corp. was extended from January 18 as bidders sought a more detailed due diligence given the mammoth size of the firm, she said, adding the company is in the process of providing data. Shipping Corp. is simultaneously demerging its non-core assets as part of the divestment transaction, she said.

(With assistance from Karolina Miziolek.)

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