The Great Eastern Shipping Company Limited (500620) Earnings Call Transcript & Summary

Good evening, ladies and gentlemen. Thank you for standing by. Welcome to GE Shipping earnings call on declaration of its financial results for the quarter and year ended March 31, 2020. [Operator Instructions] I now hand the conference over to Ms. Anjali Kumar, Head of Corporate Communications at the Great Eastern Shipping Company Limited to start the proceedings. Thank you, and over to you, ma'am.

Hello, everyone, and good afternoon on this conference call for our Q4 results of FY '20. The results were out on Saturday. So I'm assuming all of you have had a chance to get a copy of it. And we will go through the usual routine. Mr. Shivakumar will give a brief rundown on the markets and the results, and then we will have the question and answer. So over to you, Mr. Shivakumar.

Mr. Shivakumar?

Sorry, I was on mute. Yes. Good afternoon, everyone, and welcome to the conference call for Q4 and full year FY '20. We've had an exciting few months in some ways that we would rather not have and in some ways where we have -- where it's helped tankers to make a lot of money. Let's go through what's been happening in the last quarter or so. We had -- in the last part of the quarter, which is starting around the 10th, 15th of March, we had a big spike in the tanker markets. First, it was a crude tanker market as a result of OPEC deciding to go all out or rather Saudi Arabia deciding to go all out in supplying crude oil to the market. At the same time, we were facing the full impact of the pandemic and oil demand actually is estimated to have dropped by about 25 million barrels a day during the month of -- maybe starting from second half of March and going through all the way to mid-April. As a result of this, there was a huge amount of surplus oil in the market and storage started getting full very quickly. It's estimated that the amount of oil, which has gone into crude oil, which has gone into storage in this period that is in the last 3 months, is probably in the region of 800 million barrels or even more. Now tank tops were getting hit very quickly, which is that they were coming close to capacity. And the swing producer or supplier of storage capacity, as we have seen in the past, is ships, and there was immediately a storage demand on ships. We saw contango buildup towards end of March and which continued through the month of April and maybe a little bit into May also. And that enabled ships to be taken in for storage, and so you could actually play the arbitrage where you bought spot, you put it on a ship, you stored it and you sold it forward and locked in a hefty profit. And therefore, a lot of ships got taken out of the supply. As a result of this, a lot of -- the freight rate spike, VLCCs went up to almost above $200,000 a day, which is the highest we have seen in at least the last 10 years. Product tankers also went -- had a big contango play, again, with not much offtake of refined products. There was a lot of product supply building up. And again, this went into ships. There was a big contango play, especially in jet fuel because, again, most of the world's jet fleet was grounded for at least a month or so. And continues -- a large part of it continues to be grounded. And all of this went into storage as a result of a huge -- as a result of which a huge contango buildup. Product tanker rates went up to never-seen-before levels. So you had the large product tankers, the LR2s going up to close to $100,000 a day. MR tankers going up to $50,000-plus a day and even all the way up to $70,000, $75,000 a day. Not too many ships in the world fleet were able to take advantage of this because most of the ships were actually sitting and waiting to discharge and it was because there were not that many ships available to take the cargoes that the rates actually spiked. We have, however, been able to enjoy some of those in the current quarter. Now going back to Q4 of FY '20, you have the rates that we got in our presentation, you see that the crude tankers were at reasonably strong levels at $32,000 on average. You see the product tankers around the same level as the previous quarter's average, somewhere in the $18,000 range. You see the LPG carriers slightly better than the previous quarter. The previous quarter, that was, Q3 FY '20, we were at below $23,000, and here, we were close to $26,000 a day. This was mainly due to the repricing of a couple of our VLCC from old contracts, which were at much lower levels to new contracts at significantly higher levels. Dry bulk saw a weak patch in the first quarter of calendar 2020. Again, as China went into a partial shutdown, economic activities came down a little bit. We saw the demand for dry bulk cargoes go down. We also saw some of the mining countries go into a shutdown. And therefore, a reduction in the amount of cargo that could be carried as well. In the LPG market, the LPG market stayed strong through most of the financial year and almost till the end of FY '20. In the last 4 to 6 weeks, it's come off very significantly. We are down the spot market, which was trading in the $40,000-plus per day in March, is now trading in the $15,000 per day range. Our fleet is completely on time charter. The first repricing which we'll have is somewhere in the second half of this financial year. Coming to the net asset value. Our net asset value, which was somewhere in the INR 450, standard loan was in the INR 450 range -- per share range in December, has gone up slightly to around INR 454 a share. This is after payment of the interim dividend in March. We had a small drop in the prices of assets between December and March. Bulk carriers dropped by about 10% in this period, again, as a result of what is happening to freight rates. Freight rates went down terribly. So we had Capesizes down to $2,000 to $3,000 a day. We had -- Supramax was also struggling to earn even OpEx, so running at about $4,000 per day for some time. So the NAV has been flat despite the depreciation of the rupee versus the dollar, and you know that this depreciation normally gives us a benefit. But the NAV has been flat since December. However, since March last year, the NAV has moved up from -- we were about INR 375, we have moved up by about INR 80 in this period, which is 21% growth in net asset value, of which probably INR 15 a share comes from the depreciation of the rupee, but the rest of it has come from a pretty strong operating performance and the fact that we have no depreciation in the value of the fleet during the year. So we charged about INR 30-plus a share in depreciation on a stand-alone basis in this year, but that has not been the actual market depreciation, that has just been a notional accounting depreciation because the value of the fleet instead of going down by about $65 million, which is what 470 -- which is what, INR 32 a share, has actually gone up by $30 million. So -- and that's what has contributed to the movement in our net asset value. This is what happens that you're -- it's not reflecting in the results because it will -- and it will not till we sell those ships. But this is the hidden value which is sitting there in the net asset value, and it represents potentially the future earning capacity of the fleet. So this is where we are on the net asset value. In this year, that's FY '20, in the group, we have paid down approximately $180 million of debt net-net, net of some small loans which have been drawn. We paid down $180 million of debt. We have paid out a dividend. We've had buyback. And we've ended with pretty much the same cash balance that we started the year with. So it's been a good year for deleveraging the balance sheet and creating future capacity for CapEx when the opportunities come. And we are quite happy with the way the year has gone. Obviously, the results are not showing this fully. We had the hit on account of the revaluation of the loans and the derivatives mark-to-market. Again, I will reiterate that, that is notional because we have the -- on -- with regard to the impact just on the foreign exchange, we have more than a compensating asset side impact, which is not appearing in the balance sheet. The derivative MTM, again, it doesn't matter because what we've done is, we've locked in a dollar interest rate on our loans for the life of the borrowing. It doesn't matter what the up and down in the MTM is. Coming to offshore, we've gone through another year with a reasonable level of employment. We were quite optimistic on the prospects for the market in early 2020, that's in January and early February when we last spoke. And the market looked like it was turning around, it was getting a little bit of strength, utilization of the global fleet was going up or modern rigs was probably in the 75% to 80% region. However, this dramatic fall in the price of crude oil, it's -- even though it's recovered from $15 per barrel, which is what we saw about a month ago to about $35 to $38 per barrel, which is what we see now, it is still a significant fall. A lot of oil companies have announced a cut in their E&P budgets immediately and this is the pricing, they've announced an immediate cut in their E&P budget by between 20% and 30% for the year 2020. It will probably reflect in their requirement for assets. Again, let's see how it turns out if oil goes back to, say, $50, $55 per barrel. You could see some of this coming back and some more confidence coming back among the oil producers and maybe demand coming back again. But let's see how that pans out. We haven't seen any new pricing in the Indian market since -- and new contract awards in the Indian market since we had the lockdown. So we don't know how pricing has changed with this lockdown. We will come to know when there are new pricings. We have had tenders which have been bid, but we haven't seen anything closed yet. We have 6 vessels, which need to be repriced during the course of this year out of our 19 vessels. We have 1 vessel which is in -- which is completing a dry dock in Singapore. We have all the other assets -- vessels employed at varying rates. The rates may not be great, but they are on contract. Including the vessel, which is currently in dry dock, there will be 6 of them, which need to be repriced during the year. And we have bid some of them into tenders and we'll get to know as we go along what kind of rates we are able to get and whether we're able to get employment at all. About 80% of the vessel operating days have been locked in already. So it's only the remaining 20% that we are talking about. In the drilling business, we have 2 rigs. So the Charu, which came off for earlier contract early March has now gone on to her new contract, she has gone on higher now, which is a 3-year contract. We have 2 rigs coming off contract in early 2021, that is between Jan and March 2021. And those rigs will need to be repriced. There hasn't yet been a tender for that employment. We will await that tender and look to try to win that business. We can also look to go outside if there are any opportunities outside India. With regard to the coverage that we have in the shipping business, our coverage -- except for the LPG where all the assets are currently on time charter, the 5 LPG ships are on time charter. Except for the LPG, the coverage in most of the other areas is less than 20%, in the sense that less than 20% of the operating days for the coming year are covered on time charter and therefore we are open to the market movements. Let's see how that pans out. Again, we've built a large buffer for going through bad markets and that's improved with the market moves and the rates that we've seen in the last few months. Let's see how the market behaves. It will be a function of what governments do to deal with the pandemic, to deal with the aftermath of the pandemic, to see first how we come out of the pandemic and how governments deal with the aftermath of it. We can't forecast those because there are so many uncertainties to do with that. But as always, we keep our -- a lot of our capacity open in order to be able to take advantage of markets while ensuring that we are able to ride out markets even if they're very bad. We have seen -- we will see presumably a drop in oil demand as economies move into a slower growth trajectory. And again, it depends on how the oil producers react to that, whether they continue to keep the market oversupplied or whether they pull back the supply as well. Again, all of these dynamics are difficult to forecast. And therefore, we'll just wait and watch as to how they pan out. I hope that's given you a reasonable picture of how the markets have been over the last few months. Now we'll throw the floor open to questions. We are happy to take all questions.

[Operator Instructions] The first question is from the line of Rahul (sic) [ Bhavin ] Gandhi from B&K Securities.

Sir, Bhavin here. Sir, starting off, I have a few questions. First on the debt reduction itself. So we've seen about -- on a net debt basis, we have seen a reduction of about INR 700-odd crores, but if I look at the cash flow statement, obviously, you paid out a higher number. So I agree it will be because of the MTM impact on the debt. So if you can quantify what was the impact of MTM?

Okay. Let's take that offline. So we started the year with -- you're talking about consolidated, right?

Yes, yes, consolidated.

Yes, we started the year with about $500 million of cash in the group. We started with just under $1 billion in debt, $950 million in debt. So I'm just trying to get to your question. So you are saying that the drop in the net debt -- oh, okay, yes, because the net debt -- so the debt number on the balance sheet does not include the derivatives MTM. You're right. It doesn't include the derivatives MTM. So what you should take as the debt number is -- on a stand-alone basis is $560 million as of March. The number on the balance sheet does not include the MTM, which is about -- effectively will be about $75 million to $80 million. So that's the difference always.

Got it. Second, sir, on -- given where the VLSFO and HSFO spreads are today, what -- how are you thinking about the scrubber installation?

Yes. So okay. We installed 2 scrubbers on the 2 Aframaxes, so 1 Aframax and 1 LR2 last year, and those are working satisfactorily. So no issues with those. We were going to install the 4 Suezmax scrubbers in between September and December, and we pulled out of those because of where the freight markets were at that time. We -- then we were going to do it in first quarter of this year, but because of the lockdown in China, the yards were not working, we couldn't do it. So we are going to do those 4 Suezmaxes. We had another scrubber which was going to be done either on a gas carrier or an Aframax. We have decided not to do that. So we will do the 4 Suezmaxes, which are remaining. The first of those 4 will go into the dry dock in this month, in June, we are already in June. So in June, she'll be going into the dry dock for the scrubber insulation. Now we intend to go ahead with the scrubber installation. Yes, it's disappointing that the spread has come down so significantly and the current spot market spread or the current spot price spread between HSFO and VLSFO is probably $60 or $70 in Singapore, which is not a great number and doesn't give you a payback on your scrubber. But we will go ahead with it. It's not likely that it will stay this way forever. The forward price is probably in the region of $140 to -- sorry, that's on gas oil, so it's probably in the region of $100 to $110 for cal '21, '22 and '23. So with those numbers, you get back your capital at least and maybe a small positive return. So we will go ahead with the scrubbers. The projects are obviously not going to be as good as we had originally envisaged.

Got it, sir. Sir, the next question was on the impact of IMO beginning January 2020, there seems to be some increase in the fuel expenses part. I thought it was a passthrough, but it seems that might not have been the case. So if you can elaborate on that part?

It's not a passthrough in the sense that we have to take the cost. It is a -- sorry, it is a passthrough in the sense that it will appear as higher revenue and has higher cost. So if your freight rate was earlier pricing in $300 per tonne and now it is $500 per tonne, and let's say that you are getting the same TCY, your freight rate will adjust upwards and so will your fuel cost. So it has been higher, probably by about $200 per tonne on average in Jan-Feb over the previous quarter, at least in Jan-Feb before this price action happened. So yes, higher fuel costs which were recovered from the -- in the freight rate. And therefore, the freight rates would have been higher in that time.

And just one last thing, and I'll come back in the queue. On the -- just on the charter rate per se, and it means that if I go by the market rates, we have kind of underperformed, I think, for the second quarter. So is it because, like you mentioned, most ships were not able to operate at those kind of rates or is it a timing issue which is there and which will get caught up in subsequent quarter? I mean if you can just elaborate on that part?

It's not so much -- okay. We had some issues on the Aframaxes. So the Suezmaxes did reasonably well. The Aframaxes, we had a small technical issue where we are operating in a pool. And the pool -- the way the pool has performed has been -- has not been very good. So the income recognized there -- there is some uncertainty, and therefore, the income recognized has been lower to that extent. As and when -- so if we had to go by the actual performance without making any provision, it would be a higher number than this to the extent of $2,000 to $3,000 a day actually. So the Suezmax fleet would have made very close to $40,000 a day in this period -- in this quarter. If the Aframaxes, which are operating in the pool, we also have 2 Aframaxes on time charter. Okay. So out of the 5 Aframaxes, we have 1 Aframax and 1 LR -- sorry, 2 Aframaxes on time charter, which are earning in the $20,000-ish range, $20,000 to $25,000 range and the other ships are operating in the pool. So while the Suezmaxes are all 100% spot, 40% of the Aframax fleet is time charter. And therefore, will not fully get the benefit.

The next question is from the line of Chintan Sheth from Sameeksha Capital.

Yes. Sir, on the debt front again, have we repriced our debt at a lower rate as most of the economies are now reducing the dollar rates amount?

So the floating rate loans go to the lower LIBOR. The spread over LIBOR remains the same. The floating rate loans, so what was getting 6 months ago, 3-month LIBOR would probably have been 2% plus. That when it gets repriced now, where you have a reset, will probably be at 0.4 or 0.5. Yes, that will happen in the normal course. However, we have most of our debt is already in fixed rates, where we are swapping to fixed rates. So only a small portion of our total debt gets repriced. So today we have in the group about $800 million of gross debt, only $200 million or less -- less than $200 million of that will be on floating rates. So it is a benefit to have lower interest rates, but it's not going to affect our entire portfolio.

Sure. And on the fuel prices, again, given the prices that came off for most of the refined products, do we see this fuel rate percentage to go down in value terms?

Yes, it will, but it doesn't really make a difference because the customer knows what the fuel price is. So what -- yes, it can go lower or it can go higher, but what matters is what is the rate that you're able to charge the customer. When prices -- so it doesn't matter whether fuel prices are high or low. What matters is whether the shipping market is tight or not. If the market is very weak, even if the price is low, the customer will take the entire benefit. If the market...

Because if you -- sorry.

Sorry, carry on, carry on.

Yes. So if you -- in the previous question's explanation, you gave that it's a -- passthrough rates will be -- freight rates will be accordingly booked higher and fuel cost will also be higher. But if I look at as the percentage of sales for this quarter, particular quarter, that has increased from 15%, 17% range to 19%. So that is the reason why -- yes.

Okay. Yes. So I'll just put it that this is not a relevant metric for us to analyze us because -- so let me give you an example, okay? So we can employ our ships in 2 different ways, broadly. You can employ it on a voyage charter or you can employ it on a time charter. The way we measure our results, and you will see the table where we give, what is the time charter equivalent rate on each type of ship, is we want to make -- the market is at $30,000 a day for the ship, okay? You can do it on a voyage. Let's theoretically say that you can do time charter also for the same period of 30 days. So if I give it out on time charter for 30 days, I charge the customers $30,000 a day, okay? The customer spends on the fuel in a time charter. And let's say, the fuel consumption of that ship costs $15,000 a day, okay? So if I give it to that customer at $30,000 a day, I have no fuel cost at all. So the fuel cost as a proportion of sales is 0. Now if I do the same thing as a voyage with the customer, I will charge him $45,000 a day equivalent, okay? And I have to pay for the fuel cost, okay? Net-net, either I charge him $45,000, I pay $15,000 to the provider of fuel or I pay $30,000 and he pays $15,000 to the provider of fuel. But in your analysis, the time charter appears better, let's say, because the fuel cost as a proportion of the total cost base is showing lower. But it doesn't make a difference to us because in both cases, our ship is earning $30,000 a day, that $15,000 is not -- it's coming into our pocket and going out immediately even when it comes to us. It just inflates the top line. And I shouldn't use the word inflate because it implies something wrong happening. But it just -- it's made the top line higher without delivering additional value just by the virtue of the kind of employment which is done. Sometimes you don't have a choice also. And that's why we don't measure it by this fuel cost by the total. So 5 years ago, we would have had 40% of our fleet on time charter. At that time, you would have seen much lower fuel cost as a total proportion because we were only taking...

So you're basically voyage versus time charter that is driving the opportunity here?

And the price also, but the price of fuel doesn't matter. So let's say, in that same case, in the voyage itself, just take the same example and assume that you're on voyage. And let's say, the fuel price drops by 50%, okay? So instead of $15,000, net fuel price now is $7,500, and we are still on that same voyage. So either we charge them $37,500 a day and pay $7,500 as fuel, in which say $7,500 by $37,500 is 20% fuel cost as a proportion of sales. Or it is $45,000, which is $15,000 by $45,000, which is 33% fuel cost to sales. Now these are 2 different numbers. But net-net, the company has made exactly the same money in this whole equation. And therefore, it doesn't -- you can't draw a conclusion whether one ratio is better or not. So it's just -- I just want to point out, it's an irrelevant metric for us.

Right, right. Sure, sure. And lastly, on the CapEx front again, what will be the spend we will be incurring this year on the 4 Suezmax scrubber?

The average spend on each of those will be about $3 million total. But we have already incurred a lot of this expenditure before because we ordered the equipment before. So in terms of cash flow, it will be much less. So -- but we have a lot of dry docks to do as well. But just on these scrubbers, we probably have already incurred more than 50% of the cost. So it's -- again, it's a very small number. It's less than $10 million that will -- remains to be paid for those installations.

[Operator Instructions] The next question is from the line of [ Raja Kumar ] as an individual investor.

Yes. So I have couple of questions. Sir, you told that there were some upside on the tanker markets by end of March and kind of sustained till early May. So would it be possible for us -- for you to give us what would be the average TCY for the current quarter? What kind of upside that we are looking at for this quarter?

No, I'm sorry, we don't do that. We don't give any guidance.

Sir, I'm not asking for a guidance. I'm just asking for a range, like you said that the VLCC went up to almost $200,000 a day. Just wanted to know whether GE was able to lock any contracts at those rates?

Yes. So we don't have VLCC, but Suezmaxes went up close to $100,000 a day. We did get contracts luckily, we were lucky enough to get some of those contracts at high numbers. Yes. Because we have 6 Suezmaxes operating in the spot market. So we have managed to lock in some of those good rates, certainly.

Okay. And also, you mentioned that the LPG is in time charter. So -- and the repricing will happen in the second half of the current financial year. So -- and you also mentioned the current TCY is averaging about $45,000 a day. Is that the right number?

No, sorry. The current TCY is averaging?

The TCY at which it has been already booked is about $45,000 a day?

No, I didn't mention a number for that. No, we didn't mention at what rates they are fixed at. But the current -- so the spot rates were at $45,000 a day in early part of 2020. They have come down now to $15,000 a day. That's in the spot market. We don't give our time charter rate. Our time charter rate on average across our gas carriers is significantly higher than $15,000 a day as an average across our fleet.

No, would it be more than what you booked in Q4 FY '20, the 26th key number that you are showing?

Again, I'm -- no, again, that's getting very close to guidance, so I will not get into that.

Okay. Okay, no problem. So the next question is I see that you're reporting a wholly owned subsidiary to the shipping management and so on and so forth. Just wanted to know what is the strategic reason for quoting this subsidy and why it cannot be done in the existing entity?

So this is potentially a company which can offer services to third party. We have had in the past people like lenders who have taken over ships approach us and ask us if we would manage assets on their behalf. And we thought we should not put it into the main entity because it will take away the focus from the main entity. And so there are opportunities which can arise, including in commercial management of vessels or operational management of vessels. We don't want it to be a part of the main entity because it will take away the focus, and we want that to be a very specific organization, which is focused on that third-party management. Because the mindset required for a third-party management company and for an in-house management company is different and that's why we said we'll keep that separate from here.

Okay. And what is the potential you are looking at in this [Technical Difficulty]?

See, we don't have a market size kind of thing. It's only something which has come up in discussions over the last couple of years, where we saw that there seems to be a need for this. And therefore, we set it up. Again, it may not come to anything at the end of the day or it could be a big opportunity. We just don't have. So it's not like we have a consultant's report, which says market size is $1 billion and you can take advantage of that. It is something which could be an opportunity. And we have set up a vehicle to take advantage of the opportunity if it comes up. But we are not expecting it to be a very significant part of the overall operation. So it's just a small thing, which doesn't make a difference to our overall numbers.

[Operator Instructions] The next question is from the line of Nirav Shah from GeeCee Holdings.

A couple of questions. First is on the offshore front. I just want to clarify, you mentioned that the 2 rigs they are coming up for renewal in March '21 or '22?

'21.

Okay. Because I was under the impression that we replaced 2 rigs at the same time and we had 1 for -- we had 1 rig idling somewhere in 2018. Okay.

It was -- yes. So she was idling through '17, went into contract in '18, and that's a 3-year contract, and that finishes in early '21. And there was a contract which -- rig which came off contract in '18 and again went into the same -- similar 3-year contract.

So the tendering should happen somewhere in the third quarter. I mean, anytime towards September or August, September? So that...

Yes, somewhere around that time. Sometimes it happens a little earlier also, yes. But it depends.

In current environment, do you see the technical criteria for the rigs becoming more stringent because companies also -- E&P companies would also like to cut on more seriously wherever additional cost they are incurring?

Sorry. I -- so the technical criteria becoming more stringent is -- I didn't -- I couldn't make a connection with the rest of what you said.

So in this current crude price environment, technically, an E&P company would like to maximize or optimize its efficiencies. And that's how -- I mean tightens the criteria for the rigs that they are coming up for bidding, so that was where I'm coming from.

Yes. Yes, it's likely. And that's the direction it's been going in that some weightage has been given for the operating efficiency and the operating capability of the rig. We used to have till, maybe 3 years ago or 4 years ago, we used to have separate tenders for modern rigs which are more capable and old rigs. Now that is not the case, but we get a small weightage for the more capable rigs in the pricing. So let's see. Again, these things are very much in the state of luck, let's see how they develop. We will know when the tender comes out and we know what it's...

Absolutely. And in your opening remarks, you mentioned that you are open to -- I mean, relocating this rig. So what is the -- I mean, what was the thought process behind that? I mean, in what event or what environment you will look out for a different opportunity?

It depends on the pricing. Again, if we see a market opportunity where we get a reasonably -- see, moving a rig from one area to another is a significant cost. And typically, different customers have different requirements for customization. So if we can justify that cost in a contract, in a new contract, then we will look at doing it. That's how we look at all these opportunities. If we get a long-term contract, say a 3-year contract, which -- in which we are able to defray all these costs of moving and mobilizing and doing the work for the contract, we will be open to doing that.

Okay. And just a last question on the tanker market per se. I mean, the IMO event is largely played out, it seems and the current spot rates, I mean, even -- I think in the last call you mentioned that when the rate was around $30,000 to $33,000 the ROEs were in mid- to high single digits. So while I'm not extrapolating, but at the current rates, you see in terms of slippages in the order book becoming more and more visible or scrappage, maybe a couple of quarters down the line if the rates are over at around these levels, how do you see the next supply of vessels moving into '20 and '21?

Okay. One is, I don't think I would have said that in the $30,000 to $33,000 that the ROEs are in single digits because they are very strong numbers. At $30,000 to $33,000, we would be quite happy even for a Suezmax tanker, maybe for a VLCC, it's not a great rate. Even for a Suezmax tanker, it's...

You mentioned for the industry.

Oh, for the industry. Okay, yes. Because the industry's cost structure is a little different than ours. So -- okay, let's keep that aside. But at $30,000 to $33,000 for a Suezmax, it's a very decent rate indeed. But coming to what the spot market is doing currently? And I should have mentioned that earlier. Suezmax spot rates are down to about $25,000 a day. Aframaxes are down to slightly around that, maybe a little bit lower. Product tankers are all down to the $20,000 or a little lower than that, the spot market rate. So that's sort of -- the froth which was there in the market seems to have got taken out. You can see that the contango in prices has come down very significantly. There's hardly any contango now. So the storage play seems to be sort of over. Now the question is what happens to the demand? The current order book for tankers is less than 10% across the board, okay? Whether it's a crude tanker or a product tanker, the order book is at historic lows, meaning we haven't seen such low order book since the turn of the century, let's say. And which gives us a little bit of hope. But at the end of the day, you need demand as well. Now what will happen to demand, we don't know, whether scrapping will pick up, et cetera. So as I said, that part of the equation remains a big unknown. The comfort we can take is that the order book is not too high, and therefore, it will not add further pressure. So you have potentially 4% fleet growth in this year and potentially another 4% fleet growth next year in tankers, which is not too bad. You could have on -- you could have some scrapping if the markets are weak. So let's see, the order book is not building up quickly either. It's not easy to order a ship in the current situation. And there's always a worry about the technology and the new regulations, which are coming up. So hopefully, the order book should not build up too much. But again, let's see how this market plays out. If market stays strong for a long time, then you might find owners going out and placing orders. But as we speak, the market is not showing that much strength in the spot market.

The next question the next question is from the line of [indiscernible] Wealth Managers.

Yes, sir. Sir, we will be happy if you can give us some information on the voyage operating expenses breakeven for the Suez, Afra, LR2, MR2, Kamsarmax and Supramax, sir, if you could, please? VOE breakeven?

One minute. So it's not understood what you're looking at here.

The operating expenses breakeven, sir, for the different segments, like Suez, Afra products...

Okay. We have -- so we have 2 different types of operating expenses. I think you referred to DOE, which is the direct operating -- which is the voyage expenses.

Correct. VOE, yes.

Yes. So the voyage expenses. So what exactly is the breakeven in that? So if you breakeven in voyage expenses, it means you have made a TCY of 0.

Okay. Correct.

So I am not -- yes, I don't understand where you are going.

So I just wanted to get a hang on the breakeven for different segments, sir?

I don't know how to do this. So what I suggest is because this is going to take some time for us to understand what you're looking for and why it is that you're looking for it because it doesn't seem to make sense.

No, of course, we've been following some presentations of NYSE-listed Norway company, shipping companies. And they have, I mean, given the ship operating expenses for their various ships.

Okay, okay.

So if we can get a -- we will get a hang on what are -- as you have readily mentioned the spot rate, so we'll get a fairly good hang on the margin at this point?

Okay. Okay. Okay, let me give you kind of easy way to do it. So we're not looking at the voyage expenses at all. So the first thing to get out of the way is, you don't need the voyage expenses. And what you're looking at, what comes below TCY? Below TCY, you have 4 types of expense, okay? First, you have operating expenses, which is the expenses of running the ship, which is maintenance, crewing, insurance and other miscellaneous communication expense. Second, you have overhead. Third, you have interest and fourth you have depreciation, okay? The operating expenses, which is the cost to maintain and run the ship are depending on the type of vessels between $4,000 and $6,000 per day, okay? $4,000 and $6,000 per day. The overhead expenses are between $1,200 and $1,500 per day. And again, you can look at our balance sheet and annual report and calculate it. Between $1,200 and $1,500 per day. So our average OpEx is somewhere in the region of between all the different types, I said, $4,000 to $6,000, somewhere around $5,000, let's say, $5,000, a little above $5,000.

Yes, $5,000 to $7,000 usually, yes.

Yes. Okay. So interest and depreciation between the 2 of them add up to about $5,000 to $6,000 per day, okay? So if you want to see what is the fleet breakeven, you are somewhere in the region of $12,000 to $13,500 a day. If you're trying to arrive at what number does our fleet breakeven. So that's the number for you.

Right. So if you could -- is it possible you could give us the variations from Suez to Afra? Because we don't have VLCC. So yes, so how much would it be for Suez and how much would it be for Afra then?

See, the problem is that once you get into that kind of stuff, so it's not going to be very different. You have to go into depreciation of each individual asset, then it depends on what price you bought that asset. So the -- for purpose of doing the analysis, I think this is a reasonable thing. So the bulk carriers typically cost lower to run in OpEx. The crude tankers cost -- crude tankers and LPG ships cost the highest to run. So they are at close to the $6,000 range, the bulk carriers are closer to the $4,000 range. That's sort of what you can take away from it. Depreciation and interest depends on how you fund it and at which point in the cycle you buy the asset.

Okay. Sir, just wanted to get some more clarity on this -- the bunker expenses. You see, going by real's coastal shipping presentation of last quarter, I'm saying because they have not yet done for this quarter. They said that we had got a savings of -- in the bunker of about INR 7 crores. I mean, for a small shipping company, that is -- it's a pretty big significant difference. So how did that work over there? I mean, is it something like the -- you have a market price, right? So you contract the ship on the vessel on the market price and then...

I have no idea how they got a saving.

Then we spend lower on the bunker and that goes directly to our P&L, would something like that work out then?

No, no. I have absolutely no idea how...

Because from your explanation, I -- we got an idea that it is net neutral, right? That's what you meant. Correct? It doesn't make a difference.

Yes. So if you ask us the same question how much of you...

Okay. Sir, let me be more specific now. See, March end, -- yes, March end, we had the crude price, it was -- okay, let's say -- let's put it like this, in April, the -- okay, last quarter, the fuel price -- the average for the quarter would have been something at $40 a barrel, that was the crude price. Now in -- we started with -- in April at -- April was $18, that is Brent crude, I'm talking about, and May, we went up to -- May now at the -- currently, we are around $30, $35. So now in this P&L, what could be the savings in the bunker cost, given that it is typically 40% to 45% for a shipping company, the bunker fuel cost and the expenses?

Okay. So let's put it this way. Bunker cost is a part of our day-to-day life, we can't choose. If our ship needed to refuel on 15th of February at $50 a barrel, but you needed to refuel, you have to refuel. If you're lucky enough to refuel at $20 a barrel, and therefore, you get fuel of that price, you're lucky. That goes into calculation of your TCY. We don't calculate those savings separately because you will get some where you buy at $50, it drops to $20, you'll buy -- you'll have some where you buy at $20 and it goes to $50. We don't calculate that separately. It's part of the TCY calculation. So there's no point trying to track it separately because we don't have any hidden formula or secret formula for making money on the fuel costs.

So right now, sir, given that we have got only a few operating days left for in June now, still around say, 27, 28 days, let us say. So what would be the bunker fuel charges in the P&L for this quarter then given the current -- that approximately $20, let's say, $20 to say $28 would be the average for this particular quarter of Brent I'm saying?

No, no. So 2 things on this. One is the number you're asking for is irrelevant. What will we do with this number? What is the bunker cost? As I mentioned, the bunker cost is there and it's coming into the TCY calculation anyway. What -- the number that matters to you is the TCY. The second is because it's an irrelevant number, we don't even track it. Internally also, I will not be able to tell you this number because we don't track it as a thing to be tracked. It's the cost of running the ship. We are not trying to make money on that part of the business. We are trying to make money in the freight. And this is a cost which goes -- is taken out from the freight. So in trying to get to this number, we will not get anywhere. If your end objective is to try to forecast what the next quarter is going to be like, you will not get at it through seeing what the bunker cost is. That much -- that is the bottom line. And this is -- there's no point going down this path at all.

The next question from the line of Rajesh Agarwal from Moneyore Investment Advisors.

Sir, my question is on the crude carrier. Is it contango which had happened and the rates went up, what time frame we have locked in, in here, Supramax and Aframax?

You're thinking of Suezmax and Aframax? Locked in, I think, we are running on voyages, some of the voyages are -- so couple of voyages extend all the way up to 80, 90 days also. Some voyages are 30 to 40 days and get repriced frequently.

But if it is used for storage, then it can be for a longer period?

Yes, it can be. So that can go up to 100 days also.

100 days also.

But there are that many -- so we have not taken any long-term contracts. We have -- okay, we have done 1 long-term contract, which is -- long term meaning slightly longer term, which is a 6-month contract. Otherwise, the ships are in the spot market and the voyage times vary between 25 days and 90 days.

Average can be 60 to 80 days?

No, not that much. Not that much.

Not that much. And sir, the operation cost will be -- suppose if it is sailing on high seas for the next 40, 60 days, till the time it is delivered, so we'll save sufficiently on the operational costs, running costs and everything?

No, no, no. It doesn't make a difference, whether it's standing in one place or whether it is sailing. The crew salaries remain the same.

No, no. Fuel, fuel. Fuel, I'm talking about...

Oh, the fuel is priced in. So if you're in a storage contract, then that becomes a time charter in which the fuel is not on our account in any case.

Okay. It's not on our account. And second, sir, why do you feel the LPG carrier prices have come down? What is the outlook on that? What is -- why it has come in the spot?

So the -- probably, it's because the price of naphtha has dropped off very significantly. LPG and naphtha are sometimes used interchangeably in a cracker for petrochem. And the price of naphtha has come up very significantly making naphtha more attractive as compared to LPG as a pit stop. And therefore, the demand for LPG could potentially have come down. That's one of the causes which is being doubted for the drop in the freight -- LPG freight rate.

But our -- it is on time charter, all LPGs?

Our all LPG vessels are on time charter, yes.

This is for our freights, sir, 6 to 8 months?

They were all fixed for -- originally for 1 year to 2 years. So all the contracts out of the -- all those contracts, most of them will finish within the next 12 months, between September, October and April next year.

September, October, April next year, 2022?

That's right. Yes, so within the next year, '21.

So we don't have to worry on that side because it is locked in already?

Yes. For now, we don't have a worry.

And sir, what is your outlook on product carriers and dry bulk? And can you tell me the spot rates?

Spot rates in dry bulk are quite low, so somewhere in the -- depending on which sector you're looking at, all below $10,000 a day in the spot market. So doing quite poorly currently with generally poor demand, it appears. On products, they are doing not badly. So product tanker rates are still in the $15,000 to $20,000 -- for MR tankers, I'm talking about, are still in the $15,000 to $20,000 range, which is a very decent level for the product tanker.

Okay. And outlook carriers are on time charter or spot?

Most of them are on the spot market. We have -- out of our product tankers, we have 17 product tankers, of which 3 -- 4 are on time charter. So about 80% of our capacity is open -- 75% to 80% of our capacity is open.

The next question is from the line of [ Venkat Raman ] from [indiscernible] Securities. [Operator Instructions]

I wanted to know what -- in this power-point presentation, what is this revenue visibility of INR 865 crores which you have mentioned? Is it safe to assume that for crude carriers, if it's mentioned as 25%, that means the first quarter is fully booked?

No, no, no. It doesn't work like that. It is -- so a lot of them may be fully booked because we're already in end of May. So a large -- most of the quarter would be booked because you're already on voyages and that voyage will get over sometime in June. So most of it will be fully -- would have been locked in -- so -- to that extent. However, that number does not specifically mean that this quarter is booked. You could have 1 ship, which is on charter for the rest of the year and therefore will be counted as the full 4 quarters being booked. So all that represents is, whatever we have locked in, whether it is for 10 days or for 2 years, that is counted.

Okay. Okay. And the second question is regarding the mix of spot and time charter. I believe in the month of March and April, a lot of the international companies are moving -- have shifted a lot of their ships to time charter. What is the thinking of GE? And why are we not still in the 70% spot rate?

We have tried to do some time charters. We have done some. Unfortunately, there are some logistics constraints on doing time charters, including if you have a dry dock which is coming up, then the customer is not happy to do a short time charter with you. So we have -- I mentioned earlier, we have 4 scrubber fitments which are to be done on our crude tankers -- Suezmax tankers. So because of that, they have to go into dry dock, then if there's a dry dock impending, the customer does not want to release their ships typically in the middle of the charter to go for a dry dock. So because of those logistics, wherever possible, we have tried to do longer term contracts.

Okay. Okay. And one more question is in this current year, when the outlook seems to be fairly good cash flows and with no -- hardly any limited CapEx and very limited debt obligations, why are we going for additional NCD enabling resolution for another INR 1,000 crores?

So this is just in case an opportunity comes up. We took this last year also. It was a resolution last year also. And we did not need it, it was not used. So it's enabling us to do it if the opportunity arises.

And any updates on the shipping corporation disinvestment?

Nothing. We know nothing about that.

The next question is from the line of Vikram Suryavanshi from PhillipCapital.

Sir, can you comment on how is the scrap values for Suezmax and Aframax or bulk carriers? Currently, how they are moved and if you can give the numbers currently?

See, the problem is that the market is disrupted. So in this market to try to get a value because the yards were just shut down, right? It's part of the lockdown. The yards themselves had been shut down. So there is no point looking at those rates because the rates are quite irrelevant to look at. They had come down. So from the 400-plus region, they came down to somewhere in the 300 and reportedly down below 300 also. But again, when there is no market, what is the value of that price? Because you couldn't actually sell -- there was no scrapping happening, and therefore, it is sort of -- the price, you should take it with a pinch of salt.

Okay. And can you highlight about the fleet growth and order book in bulk segment and LPG?

Yes. Also pretty low. In bulk also it's 10% or lower. LPG also it's quite low, similar number. Okay, LPG maybe 10%, 11%. So in terms of order book, it's not much. I think the problem is going to be more on the demand side, really. The order book is -- so 10 years ago, when we went into the crisis in 2008-'09, we were staring at order books of 60% in bulk carriers and 30% to 40% in tanker. This time, that is not the problem. This time the problem might be that you have a real drop in demand. So at least, it's good to rule out one side, so you can have problems on both sides. That time, we had a demand worry also. This time, at least, you don't have a supply side part. So order books are still in the 10% or lower range only. So at least on that, we have no cause to worry, and there's not too much ordering happening also. We had a couple of ships...

Fleet growth, sir? Fleet growth, basically if you can -- yes, fleet growth little bit in 2%, 3% or more?

Yes, this year, you -- again, gross fleet growth will be somewhere in the 4% region for crude tankers. But you don't know how much scrapping there will be. Again, it depends on what's the rates, what happens to rates, right? See, because no -- there was hardly any scrapping in 2019 because everybody expected a strong market on account of IMO. There's been no scrapping in first 5 months -- or very little scrapping in first 5 months of this year, again, because the market has been strong. Now all of this is building up for the future because at some point, those ships have to get scrapped. The fleet, which is above 15 years old in the crude tankers is a very significant part of the field -- the fleet and will need to go at some point. So you don't have to scrap a 15-year-old ship, but if it's a 20-year-old ship, certainly, you had to seriously think about scrapping. We ourselves have a 20-year-old Suezmax tanker, where we completed the dry dock, and we are running that because the market is good. You can recover the cost of that dry dock because you can run it for 2 years after that dry dock. And with the market as it is, you can -- it certifies dry docking and extend it. So -- but at some point, these ships will have to be scrapped, which gives you a little bit of a safety net if the market goes very low. So let's see, but I think demand can drop a whole lot more. As it stands today, it looks like demand for oil has dropped by 10 million barrels a day, even after coming out of lockdown a little bit. And if you have negative demand growth, at even 5 million barrels a day, that's going to be a really tough thing for the markets -- for tanker freight markets, then you need a lot of scrapping to balance them or a lot of removals one way or another to balance the market.

Correct. And sir, I got your comment on stand-alone NAV. So would you like to give details about consolidated NAV?

Yes. So the consolidated NAV is between INR 490 and INR 540 per share, approximately. So what has happened is that's come -- it's about the same as last year. It's basically because of the uncertainty around the valuation of offshore assets. The range has been extended, which is -- and you know that we have been getting -- you get a fairly fine valuation for ships. But for offshore assets, you get a range of valuation because the market is not as liquid. So what the valuers or brokers have done this time is that they've given a wide range of valuation. And in that widening, they've basically brought down the minimum price, the lower end of the valuation, and therefore, that has dropped off significantly. So the lower end was -- used to be somewhere in the INR 520 region, and that's dropped now to the INR 490 region. So offshore assets are still struggling to get valuation, then they got hit further and there are not many transactions happening. You are seeing a lot of stress among the listed offshore companies, especially the drilling companies, which have -- the market caps of those companies have dropped off to $100 million which were a few billion dollars earlier. So that's affected the NAV.

Okay. Last question, sir, how is the liquidity in time charter market because we have seen huge volatility in spot. So how is the liquidity, if you want to really -- apart from logistic issues, what you said about dry docking and other to enter into long-term contract, but are -- how you can explain logistics liquidity in terms of time charter market has moved?

Yes. So there has been reasonable level of fixing of ships. It's not easy to do because of the speed at which the market is moving. In fact, even in the spot market, and this is the phenomenon which you're seeing, is typically in a spot market picture for a crude tanker, you fix the ship -- you're a customer, you fix the ship, and you say that 2 days -- it's on 2-day subjects in order to clear all the logistic issues, you had to get a terminal clearance, et cetera. Effectively, you've got a free option for those 2 days because you can -- if the market goes down in that period, you can drop that ship. You can say that I no longer want that ship, okay? Now in a time charter, it's even more [Technical Difficulty] and basically, if the market changes in that time, you can get dropped in that period. And therefore, in a fast-moving market, especially if the market is coming off quickly, you can't really [Technical Difficulty]. So the only way to fix is to fix before -- even before the market drop happen. So you sacrifice something in the rate. Even if you think it's going to go up further, you sacrifice something in the rate for the certainty of fixing. And when we look at that, we typically look at the spot market rate and say that instead of a 1-year, let's say, you can fix it at 1-year at whatever rate, $30,000 or $40,000. If you include the voyage for 45 days at, say, $75,000 a day, then your breakeven for the remaining period comes down very significantly. And sometimes, you just have to say that I'm not going to take the uncertainty of trying to fix, I'll just take the business, which is there now and then look at it later and then take my chances with the next spot picture or trying to time charter that we can give. So it's tough -- so transactions have happened. But a lot of -- you need a lot of luck to get these transactions done. You need the market to hold up because there's so much time between the time that you commit to the transaction and the charterer commits to the transaction.

The next question is from the line of Rajiv Agrawal from Sterling Capital.

I wanted to understand the calculation...

Sorry, Mr. Agrawal, you're not very loud, can you please speak up a bit?

Yes. I want -- okay. I want to understand the calculation on net asset value? So basically, in the -- you first calculate the market value of assets then you also subtract some liabilities, debts et cetera?

So what we do is, you take the balance sheet -- how do you calculate the book value per share.

Okay. Assets minus...

External liabilities divided by number of shares, right? All we do is we take out the value of the -- the book value of ships, and we replace it with the market value of the ship.

Okay.

And there you have it because you just replace that, and now you have the net asset value of the fleet. So it is the market value of the ships plus -- minus net debt. So the rest -- plus other assets minus debt and divide this by the number of shares, you have the net asset value per share.

Okay. Okay. Okay, sir. I got it. Sir, and one more question is that, sir, this -- in dry bulk, the rates are -- I think are at multiyear lows, right? If I -- if my information is correct. So are you planning to acquire any assets in dry bulk or what are the fleet expansion plans to take advantage of these low rates?

We don't go in with a fixed plan. We look at transactions which come to us, and we see whether they make sense at that time. As it stands today, the prices don't yet seem very attractive, but that could easily change tomorrow or the day after. Yes, among all the asset classes, it may be that dry bulk are looking lowest. But as it stands, nothing is planned. We have the capacity to buy quickly and move quickly and buy in volume, but nothing planned for now. We don't have a planned CapEx, if that is what you're are asking. We will be opportunistic in whenever the market presents those values.

Next question is from the line of Avinash Vazirani from Jupiter Asset Management.

Maybe I'm going to do a quick follow-up because I know you're short of time. The first question is, can you just tell us what is -- what percentage of revenues, costs, debt, and cash, is in INR, please?

So good point. Revenues are a little over 50% received in hard currency dollars. I'm talking about the shipping business. However, almost 100% is denominated in dollars. It's just a difference in the currency in which we receive it. For instance, let me...

Okay. I get it. 100% so is it a 100% dollars you can get in rupee, that's fine. In costs?

Sorry? Yes. In costs, we have about -- of our operating -- of our interest cost, 100% is dollar. Our repayments are 100% in dollars one way or another. Our overheads are 100% in rupees. Of our operating expenses, about 75% to 80% -- 75% is dollar-linked -- foreign currency linked, let's say, most of it dollars, but it could also be euro or yen depending on the supply. So we are net...

And the cash...

Yes. Sorry, you continue.

Yes. And the cash that you hold at bank, that's all dollars, is it?

So our treasury is about 1/3 in rupees and 2/3 in dollars.

Right. Okay. What I'm trying to understand is these kind of very large exchange gains and losses items that you have in derivatives positions, can you kind of explain what exactly are you hedging? Are you hedging your INR costs? Are you hedging your balance sheet? Are you hedging your fuel? Are you hedging your revenues? So just kind of just explain what exactly you're trying to do and how you view your company, please?

Okay. Yes. Thanks for asking this question. This is something that we should -- we should explain. So what are we trying to do? We are buying dollar assets. We are buying ships which are denominated in dollars, which earn in dollars, okay? So that flows from the ships are in dollars. And we sell the ships also, we sell them to an overseas party and the price is denominated in dollars. So our asset side and our income side is dollars. Our inflows are therefore in dollars. What we are trying to do is to not have an asset liability mismatch on the currency side. And therefore, we try to create -- we try to have dollar liabilities to fund these dollar assets. Dollar liabilities you can have either by just borrowing straight dollars, which we do. So you take a dollar loan to fund your ship and you buy the ship, okay? So now what happens to that? According to the accounting standard, let's say that you bought a ship. So you bought a ship for $20 million, and let's keep it really simple and say you buy the ship for $20 million, you fund it with a loan of $20 million, okay? You bought that ship when the dollar-rupee was at INR 70, okay? So you have a ship which is worth INR 140 crores, yes? You have a loan, which is worth of INR 140 crores. That's your balance sheet on day 1. On March 31, it's gone to INR 75, okay? Your ship remains on your book at INR 140 crores, you don't revalue your ship. Your loan, however, has to be revalued to INR 150 crores -- INR 75 x $20 million, it becomes INR 150 crores. That INR 10 crore change in the value of the loan has to be taken to the P&L as a revaluation loss.

Yes. Yes, understood.

Yes. On the flip side, and you have understood this that there's a $10 million gain also which is sitting there in our balance sheet.

Sure. Sure.

As per the accounting standard does not permit us to recognize that gain, which is on the ship, which is sitting embedded in that ship.

Okay. Well, I understand that. What I'm trying to understand is, you have a lot of hedging going on in derivatives. So to me, you're actually quite simple, you are a dollar company with some INR costs, and...

Yes, yes. Just hold on for a moment. I'll tell you about the derivatives. Yes. So I'll tell you about the derivatives. So the one I explained to you was a very straightforward transaction, yes, which was you borrow dollars and you buy a dollar ship. The second thing which kind of funding which we did, was where an opportunity came up where you could borrow rupees, get longer tenor of loans and get it cheaper and swap it into dollars and get it cheaper than just borrowing dollars. So you get cheaper funding and you get... Okay. Now what has happened, you have put a derivative on top on your rupee borrowing. And this means, so the same change, which happens at INR 5 change, which has happened in the exchange rate now reflects as a derivative loss.

Okay, okay. I got it. So you're not trying to hedge your balance sheet. The hedging that you have done is essentially your individual dollar contracts. So we essentially cross currency, whether it's INR or whether it's U.S. or whatever, right? Is that what you're trying to do?

That's right. So we're trying to match the currency of the inflows and the outflows to the extent we can by creating a dollar liability. Yes, so we're trying to reduce the mismatch. We can't do anything about the equities because the equity is rupees on the liability side, but the debt at least should be 100% in dollars.

Right. I get it. And do you -- did I understand correctly that bunkers are pass-through for you, and you don't do any hedging or anything on your bunker costs at all?

We do a little bit of hedging. We do a little bit of hedging. We take a market call some time. And especially if we have contract. So it's a pass-through if you are in the spot market 100%. Sometimes, you have something called a contract of affreightment, which is where you have locked into a long-term contract, but it's not a time charter. It's a long-term voyage charter contract, where you have priced in a certain fuel cost and you have to ensure that you lock in that fuel cost so that you are not losing out on the margin. So we do those compulsorily. Apart from that, we do a little bit of hedging based on a view, but it's very marginal in the overall context.

Okay. So essentially, you do some "speculative hedging" on fuel. In terms of your currencies, you're not doing any of that, you're just hedging your assets in terms of your liabilities?

That is correct.

Okay. So if you were to do your accounts in U.S. dollars, a lot of these hedging gains and losses will actually won't happen?

That is mostly correct, but there's also a derivative in between. And the derivative MTM, I don't -- I'm not 100% sure how it will get created because that is a derivative, it's not just a dollar revaluation.

Right. Right. Yes. Okay. I got it. Just by the way, I mean, if you were to quote more details on your derivative exposures on your balance sheet, on your presentations, I think it will be actually very, very helpful for investors because I think what you just explained actually doesn't really come across either in your annual report or in your presentations. And -- but what we seem to be doing is pretty good, really.

We'll take that on board. Thank you, we'll -- and we'll try to do something about that.

The next question is from the line of Dhruv Jain from AMBIT Capital.

I had a small question with respect to -- there has been some buildup with respect to capital working progress. I see some INR 100 crores have increased Y-o-Y so what is that?

Yes, this is the scrubbers, which are waiting to be -- some of them, they are -- the scrubbers waiting to be installed work which has been done for dry docks. That kind of thing.

And sir -- all right. And sir, I mean just you partly answered that question, but in a sense that how are you looking at the markets, say, 12 months from now? I mean 12 months can be long -- a very long period in shipping, but considering that OPEC is doing these cults in production. So can we -- is it fair to say that the recent sort of rally that we saw is like winter demand coming in a little early?

No. So the rally that -- so the one rally that we saw in October was probably because of the COSCO sanctions, right? And the second rally we saw was in March, which was just on account of there being tremendous oversupply of crude oil.

Yes. I'm talking about that one, sir.

Yes. It is just a tremendous oversupply of crude oil. There was a huge drop in demand, and there was just too much crude oil and that had to go into storage, and therefore, that pulled ships from the trading fleet. So none of which is in by the fundamentals of [Technical Difficulty]

So considering that inventory drawdowns will actually happen once things start opening up, so do we expect the rates to be slightly weaker, I mean going, say, 12 months from now or 6 months from now?

[Technical Difficulty] for the tanker business. [Technical Difficulty] in this whole April and May is basically [Technical Difficulty] from the future. This is oil, which should have [Technical Difficulty] for the next 6, 7 months for all of the producing [Technical Difficulty] instead of that it went [Technical Difficulty] now in the month of April and caused that huge excitement and therefore, the uptick in rate. And this will have demand of the future because you just borrowed from the future demand. The oil which is required in the month of August is already lined up in the consuming areas, and it's being stored there. It will get drawn down from there, and the ship will get released. So it's not a great kind of outlook for the business, unless the contango builds up, unless you have a second wave and again, your contango builds up, you have an oversupply. But yes, what you're saying is right, the outlook doesn't look great because of -- you basically taken the demand -- you already transported the oil in the month of April and May, and you don't need to transport it again in September. So that's a fairly subdued outlook. So it's very dangerous to forecast anything these days. We were expecting a strong winter market because of IMO, and nothing happened -- we don't know why it was strong, but probably not because of IMO, but it was very strong anyway. So -- but generally, the fundamentals seem to be lining up behind a weak tanker market.

The next question is from the line of [ Pankaj Sanha ] individual investor.

I had 2 small questions. One is if your NAV is INR 500 or INR 490 to INR 540, can we expect to buy back, too?

No. That's for the Board to consider. As it stands, it's less than a year since we finished our last buyback. So regulatory, we can't even consider a buyback till the end of November. So for now, nothing is to be done. But yes, it is very cheap as compared to NAV. It's probably -- and we've been declaring our NAV for almost 20 years now. In the overall scheme of things, this discount to NAV is among the highest we have seen in the last 15 to 20 years.

Okay. And these MTM losses or these derivative losses are exclusively on account of the extension, nothing to do with your forward contracts of affreightment?

No, no, no. Nothing to do with COAs. We don't have any COAs currently. So none of -- these are exclusively to do with the borrowing trending. So let me put one more MTM, which is there. So we've gone into fixed rates at 2% in dollars. So swapping the LIBOR effectively at 2%. Today, that LIBOR swap is at 0.6%. So it looks terrible, and there's an MTM loss. But at the end of the day, you have locked in your interest rates at 2% LIBOR. So that's how we look at it. It's a transaction where you have locked in a rate at a very attractive level. And sometimes it just looks bad on your P&L when you'll do an MTM. But in the overall scheme of things, it's a good transaction to do.

So notionally, when we see a loss for the current quarter, I -- we should just ignore that.

Yes. These -- so again, in the Chairman's later last year or the previous year, the Chairman had written that these -- ideally, you should ignore these derivative losses and ForEx losses. Because -- and again, I think the earlier person who asked a question, we need to explain this a lot better, that we are not doing any speculative transactions. These are transactions which make sense to do just to -- are actually trying to hedge our position and to reduce the risk rather than increase it. And this should be ignored in the context of our results. And the real metric for us is how does the NAV move because that that does not go into the accounting side of things that looks at the intrinsic value of the stock.

And just one last point is, I think you need to be congratulated on your patience. I think what you should do is each time you send out your presentation, you need to send a small note on what is the difference between a voyage charter and what is that time charter and how bunkers do not -- cost of fuel does not affect the way your balance sheet or your results look. I think we spent almost 45 minutes on explanation on what is a voyage charter, what is the flow-through of bunker prices on your results?

No. That's okay. So we are here to educate investors. Now that everybody can come in in knowing everything. But yes, certainly we should put out kind of a glossary to give base information, yes.

Yes. I think if you put it, I think a lot of questions would not come up. I mean just a suggestion.

Thank you. We'll take that on board and try to do that. Yes.

The next question is from the line of Deep Master from One-up Financial Consultants.

I just wanted to kind of tie in your comments on IMO and just kind of look at how you guys are sort of expecting the year, the medium term to sort of play out? Like, I think you mentioned that the spreads are down quite a bit and maybe the payback on scrubbers may not be as good. But sort of what can you change going forward to kind of bring that whole IMO -- the benefits of IMO actually coming through? Can we still expect to see some of those come in?

See, one of the reasons for the drop in the spread is actually the drop in the flat price of crude oil, which is the absolute price of crude oil. Because sometimes the spreads are just related to the total amount that you're paying. The spread will not be the same at $60 crude and at $30 crude.

Of course.

So if the price of crude oil itself goes up, hopefully, that spread will widen a little bit. However -- so at the beginning of January, and this is -- that was a slightly disrupted market, and we saw the spread going up to close to $400 per tonne. Okay. Again, that was not sustainable. Pretty soon, it came down to $300 by February -- by end of January, sorry. It's probably not going to be there on average at $300, but you don't -- we don't need it to be at $300. We did not price $300 over a 4-year period for payback. So at $150, we would -- I think we'd get a full payback and maybe a little bit of return as well. So I still don't know what it is that would increase that spread. Now what is...

So your VLSFO?

So what we're talking about is the spread between the high sulfur and the low sulfur fuel, right? So the low sulfur fuel is sometimes a blend of gas oil and fuel oil -- and high sulfur fuel oil. The problem we have currently is that the price of gas oil has dropped off significantly because there's just very little demand for it. There's a negative demand growth. Now once the economies start moving again and diesel demand picks up, hopefully, the crack spreads for gas oil go up and therefore, push up the price of low sulfur fuel because it's a blend of gas oil and high sulfur fuel. That could take it up. Now again, whether it will go back up to $300 is anybody's guess. But it -- for it to remain at -- today, $70 or even at $100, it's going to be pretty tough. Say it will be very unusual for it to remain at [Technical Difficulty].

Great. And I guess the whole tightening that we were expecting to see in the oil market for now, it's not going to play out until you actually see sort of OPEC following through on that promise and sort of sticking together, at least sort of coordinating better in terms of supply. So...

So they seem to have done that. So from the flows, they really seem to have done that. It looks like they have dropped it by -- and there's not much cheating happening. So actually, it dropped off by 8 million barrels in the month of May. So which is what has taken prices lower. In fact, we are starting to see some little draws from floating storage as well. So it appears that, that's having an impact. The oversupply has got taken out, it seems that the market is in balance as we speak. The crude oil market is in balance as we speak.

And I guess that's benefiting from sort of the demand coming back from China and some driving demand in the U.S. as well?

That's correct. Yes. And the fact -- again, it's still 10 million barrels lower than what it was in January. But at least it reached a stable level where there's not too much oversupply, which is what has really driven the price of oil down to below $20.

So if this scenario kind of just incrementally gets better, then the rates should stabilize here, the current rates -- the tanker rates?

Oil prices -- tanker rates are pretty low. So yes, they can stabilize here, but I'll be surprised if they stay at these numbers. If you have demand staying at these numbers, demand is actually, as I said, 10 million barrels per day lower than it was 6 months ago.

Right. So I mean if it incrementally improves from here tanker rates actually possibly at a bottom?

Not -- no. I wouldn't call this a bottom at all. They're still at very decent levels, they are higher than they were a year ago.

Right. Right. And just on the dry bulk side now with China opening up again, and hopefully, Brazil, if things improve in Brazil, are these rates again pretty low and unsustainable? Or is there still some time to go for us to see an improvement there?

There's some time to come by. It doesn't seem like things are improving in Brazil. We keep hearing about new shutdowns happening there. So I think they're going to have some difficulty putting out the commodity. So it's dry bulk is not showing those early -- okay, it showed an uptick a couple of weeks ago, but it's sort of subdued again. So though China seems to have come back, and steel production in China has been strong. And for some of the industries in India as well are coming back things like cement et cetera. But overall, we are not seeing that reflected in strong dry bulk demand. So if you recall, last year, we had a very poor first 3 to 4 months of cal 2019 in dry bulk and then we had a sudden -- like a coiled spring bouncing back in the month of May, June, July. So we are not yet seeing anywhere near that in dry bulk this year.

The next question is from the line of Vaibhav Badjatya from HNI Investment.

What's your view currently on the strength of OPEC alliance currently? Because from a longer term perspective on our offshore fleets, that's what matters a lot. So just wanted to get your view on the strength of the OPEC alliance after all this whatever has happened in last 6 months?

So on a lighter note, you should not take my views on this because I did not expect OPEC to start pumping plus 2.5 million barrels a day in early March. We thought that they would be cutting by 2.5 million barrels a day. So far, the views have not turned out to be very correct in this matter. Nobody knows how they will react. And they have of course their own compulsion. So better not to try to focus what OPEC does. But it seems that the oil prices at least are on the recovery track. I would not have expected a near 10 million barrels a day cut being agreed by them. And that, too, for the last 1 month, they seem to have been abiding by that agreement. So there seems to be some level of discipline there, and maybe that will last. And hopefully, then oil price goes up and the offshore market, it recovers a little bit.

Okay. And last time, you have said that LPG -- our LPG fleets got affected because there is some uncompetitiveness related to the naphtha that has happened. So last time when did you saw this kind of things happening [ where ] naphtha became more competitive in LPG?

Yes. That is probably about 2 years ago when the market again was very weak. I'm not remembering 100%, but I think it was sometime in 2018. So around this time, I think the market was pretty weak in June 2018, where I think we had a similar situation with regard to naphtha. I think so. I'm not 100% sure, but vaguely recall it. Again, if demand picks up again, and this is also, again, because the price of oil is low, right? And the price of LPG does not drop as much as the price of oil because it's not traded as much. And the price of oil guide drives the price of naphtha as well. And that's why the price of naphtha dropped off very significantly. So again, if oil demand comes back, and therefore, the price of oil goes up, hopefully, that will now again make LPG reasonably attractive.

And just wanted to check [ and probably ] verify my understanding. So if we see as a company, which is completely trying to convert everything into U.S. dollar, then should we view your return on capital employed assuming that you are a U.S.-listed company? I just wanted to understand how should you think about it, whether your ROC of 6%, 7% is -- I'm just taking hypothetical numbers, but if you generate ROC of 6%, 7%, should we view it as not so good because the Indian government bond yield is 6%, 7% or should we compare it to the U.S. government bonds?

No, no. So in dollar terms, we should be in a position to make an ROC better than 6%, 7%. We might have cost of debt, which is lower. So our average cost of debt is 4%, and therefore, you can put that leverage on at 4%. And let's say you make 7% and you're able to leverage it at 4%, and you'll get a 10% plus. I'm talking about a dollar return. If we -- yes, if we are able to make a -- on the total capital employed, if we are able to make a dollar return of 7% to 8%, I think it will be a good -- including the cash, I think it will be a good performance.

No. I was actually coming from the point of view of when we calculate your numbers from your stated balance sheet, which is disclosed to the exchanges, right? And we calculate ROC based on that. Whatever ROC comes from those numbers, should we compare that to the general level of U.S. interest rate or should we compare it with the Indian [ level ]

Okay. You should -- okay. Good point. Let me think about this. I haven't thought about it.

Because I think we should do -- I think after removing derivative losses, we should do it with U.S...

I agree. I tend to agree, but let us think about this. It's worth discussing -- thinking about it and discussing. Yes.

Because that will just totally change a lot of things.

Yes. So we are a dollar business. So I think we compare it with U.S. dollar return. But our endeavor is to make at least a 10% U.S. dollar return on our negatives.

Yes. But I think that probably might not work when you start selling your ships. But as of now probably it works. But anyways, I think that's it from my side.

The next question is from the line of from Raghav Bhutoria from Lindsay Securities.

So we saw some of the market tightening in tanker coming through because of floating storage. So do we have any data on what's the quantum of that floating storage currently and whether how much has been drawn and -- or how much has been added over the last month or so?

Yes, we do have some info -- nothing much has been added over the last month. There is a marginal draw. So let's look at it versus a year ago, right? Because this floating storage started about 2 months ago. You probably added about 100 million barrels of crude oil to floating storage, on ships. In the last year, most of which came between March and now, and it's been flat around that number, probably up, down 10 million barrels a day within -- after that, maybe it's marginally down now. So this is the last report I saw 2 days back.

So that is why probably the...

Yes.

So that is why probably the rates are still higher compared to last year because I would have expected if some of the draws are happening from ships and ships get freed up, you would have more competition?

Yes. So okay. Now there's floating storage, yes, some of it is that it's -- the other is that ship I just touch because they're not contracted for storage, but they're just standing and waiting to discharge because there's no space in the tank. The inefficiency of the process which has happened because there is no tank capacity, which has also taken it in because otherwise, you would not have the market being so strong. See, again, I come back to 10 million barrels a day drop in demand is a massive amount of drop. Just a 2 million barrels a day drop in demand can take tanker credits down to OpEx. 10 million barrels a day demand should -- would everything else being equal, see a very terrible tanker market. Some of it is taken up by this floating storage, some of it is just taken up by inefficiencies in the supply chain.

Right. So we've also heard of some delays happening at ports, is it just because of not having enough capacity of crude to store for the refineries or are there some other reasons also going on?

A lot of inefficiencies come in. So you have that, which is you don't have the capacity assured. You're trying to pump out 1 million barrels of crude oil, and there's no capacity to hold that 1 million barrels because the refinery input has reduced. The second is just a quarantine. Supposing you have a requirement that you should have spent at least 14 days from the last port that you called and your voyage was only 6 days from the last port that you called. So that's 8 days where you're just standing doing nothing, which is created -- so that's 1 ship, 8 days, which has got taken out of the market, which has created an inefficiency in the system. So these are the kind of...

This can be expected to continue basically for -- till the time COVID is there?

Yes. See, some people, they start relaxing these requirements. It depends -- again, it depends on whether you have a second wave, which is more serious, et cetera. But yes, people -- I think these will start getting relaxed soon enough. Again -- this is, again, a forecast, which is dangerous to make. Because it depends on how the pandemic progresses in different countries. But this is -- as it stands, it's causing inefficiency.

So whenever those ships are stalled, you're earning demurrage and not the actual TCY that you contracted?

Yes. But the point -- yes, you're running demurrage, which can be close to the actual TCY in the voyage charter. But the more important thing is when the ship is standing is that it has got taken out of -- it's caused a tightening in the overall supply-demand balance of the fleet itself, okay? So that's the critical part of it. It doesn't matter what that ship is earning. That ship may be earning $10,000 a day because it was fixed 3 months ago when the rate was poor. But the fact is that ship has got removed from the supply and therefore, help to tighten the market to that extent.

The next question is from the line of Chintan Sheth from Sameeksha Capital.

On the operating days for the FY '21, you said the 4 Suezmax will go on dry dock for scrubbers and one another is expected to go dry dock for upgrade. So...

So just hold on, what is this upgrade? 4 are going to dry dock for scrubber.

Then you also mentioned 1 of the ships will go for the dry dock in the commentary, which is...

No. So the general dry docking is at least 8 to 10 other ship which is going to dry dock.

Right. So how many revenue days will be lost because of that in the coming year in total, if you can provide that? And what will be the additional OpEx because of dry dock for the full year?

So one is the dry dock cost does not go into the OpEx. The dry dock cost gets capitalized and depreciated over the time till the next ride. It goes into depreciation cost, okay? So that's one. It's not in OpEx. Second is, dry docks happen all the time. So it is the only time it should matter is if you have an exceptional year of dry docking where instead of your normal rate of doing take 10 dry docking in a year, you are going to do 20 dry dockings in the year. So what we have to look at is what is incremental. The other thing that you can look at is when you have high-value ships going into dry dock because then their earning capacity is different from the earning capacity of a smaller ship. So here, in this case, the Suezmax is going into dry dock is a significant event because first, typically, our dry dock will be 40, 45 days because of the scrubber fitment. So that's between 160 and, let's call it, 200 days between 4 of them. And Suezmax days are the most valuable of the days, right? So that will be going out and that's the most significant and the other dry docks are in the routine course of things.

So it will be insignificant. We don't have too much read into it.

That's right.

And what will be the CapEx amount? The capitalized portion of the dry dock for the full year apart from the scrubber you mentioned?

See, yes, yes. So your total CapEx should be -- dry dock expenditure should be in the region of $20 million to $30 million.

Next question is a follow-up question from Rajesh Agarwal from Moneyore Investment Advisors.

Sir, my question is on the offshore side. Offshore, what is the revenue visibility? And how many number of days it has been booked offshore logistics and drilling services together?

Offshore logistics that days -- 80% of the days, we have 19 vessels. 80% of the days for this year have been booked already -- are already on contract. So that's one, let's keep that out -- get that out of the way. Out of the rigs, we have 2 rigs, which will be on contract for the full year. So for the first 2 months almost, we had 1 rig, which was doing her work, now she's gone on contract. So she will be on contract all the way, hopefully, up to March and going for a total of 3 years. 2 rigs are coming off contract between January and March. So approximately -- so what that's -- yes, 80% to 90% of our days are locked in the rig business. 90% of our days are locked in for the rig business.

These are all the old rates which we had locked in?

Old rates meaning, yes, they are at fairly low rates.

So is there any visibility up for the next year or no from '21, '21 or no?

You mean FY '22?

'22.

Two rigs will continue on contract. One has to go on -- will go till end of FY '22 and one will go on till early FY '24.

And any other contracts on the logistics side, no?

No. Contracts, meaning, we have tenders. So we have contracts, which will go till '22, '23, we have long-term contracts.

So we may not fetch better rates because of crude prices coming down?

Sorry?

In new contracts, we may not fetch a better rate, which is already there?

Yes, I don't know, let's see. We don't know how the markets turn out.

And sir, last one suggestion. We are running such a huge treasury, why don't we pay out the dollar debt then?

No. See, the treasury is short-term liquidity management. It's a short-term liquidity management function. Debt is long-term debt to fund the long-term assets of the company or the business. The treasury is here to be able to take advantage of markets where we see suddenly value in buying ships at short notice. This is what we were able to do in 2016 and '17, which is delivering sort of returns to us today. So that...

You're making extra alpha on the dollar debt to cost.

No, no, we don't make. No, we don't make a spread on the cost -- so you -- if you mean, do we have a positive carry between...

Yes, positive carry.

Cost of debt on our treasury? No, we don't have a positive carry because we don't take any risk with the money. It's just a liquidity management function. So we don't -- in the money. It's...

But is it necessary to such a huge amount? Is it necessary?

Yes. Okay. See, it's not necessary, but it's the only way you will have the money available to if you want to buy a ship with -- at 30 days' notice. So it helps the business. We have had this discussion internally also. And we had a treasury, which was 50% of our balance sheet at one point in time, and we had this discussion at that time that it's a waste. But this is the thing which really gives us the optionality to run our fleet spot and to be able to buy ships when other people are forced to sell ships because the market is good.

[Operator Instructions] The next question is a follow-up question from the line of Deep Master from One-up Financial Consultants.

Yes, Shiva, I had a couple of follow-ups. So to understand how you're looking at capital allocation in the current year sort of the decision between paying down debt and acquiring incremental ships, given that you've had quite a good year and going forward, we should have some decent cash flows in the current year as well. How would you all kind of decide between buying a ship and paying down debt?

So paying down debt, we very rarely do anything in advance. So that's the first thing. So we just -- we pay down as per the schedule. So we very rarely say that no, no, we are going to use our money to pay down debt because the cost of holding on to it, we've seen. So what does your debt cost you? And it costs us less than 4%. At cost you will make up very easily by -- and you'll have a negative carry of, say, 2.5% on that, 3% on that. At negative carry, you will make up very easily in the next purchase that you are able to do very quickly. And that is what we do. So we won't really go out and pay down debt. It's unlikely. In some of the cases, it's not even much of an option because it's not like a bank loan where you can go and talk to the bank and say, take the money back, repayment. It is NCDs, which are not really easily available to buyback. You have to go out and launch a buyback for those NCDs and they are not really easily available. People like to hold on to them or put them in the hold to maturity portfolio. So then it comes down to capital allocation. The capital allocation will depend on what's cheap at that point in time. If we -- if the market pans out, as one scenario says that you'll have very weak tanker market. And you get very attractive prices. They are happy to buy if all carrier prices drop 20% from here or 15% from here, maybe those will look attractive. So opportunities will come in -- and we've seen this. And in 2012, '13, we had this thing about -- we'll never get the opportunity to buy and we're just sitting on cash and doing nothing with it. But the opportunities do come and cycles are shorter. And those opportunities come for purchase. Now the good thing is that you are in dry bulk, you are in LPG, you are in products and in crude. And they don't necessarily move together. So you could have one sector moving very strong and one sector being very weak, like we've seen just now in crude and dry bulk. And so those opportunities will come up as well for capital allocation.

Okay. So at current rates, does anything look attractive? Any of the markets kind of look attractive? Or even dry bulk, you're saying you would probably only look at something if prices fall 20%?

Yes. Yes, yes. At current prices, nothing looks attractive.

Nothing looks attractive.

The second thing is that forget about current prices, in current logistic situation, we can't buy anything because you can't even inspect a ship, you can't delivery of a ship. So that's the other logistics part of it, but in any case, the prices are not very attractive. We are deep value buyers, so we need that at price.

Right. And given that you're still 80% on spot, is it safe to assume that we're still sort of hoping for a improvement in rates due to IMO? Or is it just that we didn't get the opportunity to sort of tie up on time charters?

IMO story is sort of, I think, it's done. So it will be a general tightening of the market. I think, the IMO story is sort of done. It will be a maybe potentially a progressive tightening. Yes, ideally, it would have been nice to have fixed out a couple more ships at least in the high-end market. But it did not happen. It was not free to execute, especially on the product tanker side, though, the rates were so high, the time charters were few and far between at different levels. So the rates went up, the rates went up from $15,000 a day to $65,000 a day in the spot market for a MR tanker. The time charter rates went up from $14,500 to probably $18,000 a day, okay? And you just say that, no, that doesn't make sense. Maybe you could have pushed it to $20,000, it doesn't make sense because you can make up that entire premium in 1 voyage. So that's the whole thing. It didn't really -- sometimes the rates didn't make sense, sometimes you just didn't have the time to do it.

Got it. And the general titles you're talking about is it basically the order book positioning being quite light and hopefully, some scrapping, given that the market is quite weak.

That's right. That's right. So that is what will give us some confidence to make some purchases, but for that also we need a significant drop in prices to have that comfort.

The next question is from the line of [ Samraj ] from [ Dwaraka Wealth Managers ].

Sir, I just wanted to ask you one thing when we have discussed about this NAV, and you said that we have got hidden value of almost INR 30 in an NAV, okay, that's one. Now if you go through the NYSE-listed companies, even GasLog, I'm talking about LPG tanker share or let's talk about Euronav or FRO or even Scorpio, a pure product tankers. Sir, compared on different segments. Now what I find is significantly the enterprise value to the EBITDA is huge. I mean it's ranging from almost 4.64 for Euronav right up to for gas -- for GOGL, of course, the earnings have come down on the bunker side. So almost 76. So is it not a good idea that GE Shipping could list on NYSE and get our required intrinsic market cap? I mean this is huge. And then sir, subsequently, one [ Mr. Venkatesh ], asked about Shipping Corporation, that's running at 0.9. On the other side, you are 4x more valuable than Shipping Corporation that would be a good takeover. I mean both sides, could you just give us your opinion, sir?

Interesting idea. Yes, certainly, the valuations, which the western markets give are much better than the Indian market. So one is, we are told is that those are pure plays and so easier to understand. But in general, if you just look back at and permit me to boost a little bit. If you look back at our performance over the last 5, 10, 15 years against most of the listed companies worldwide, we are in the top 10% of companies worldwide in terms of return, in terms of returns that we have actually produced. This is not returns to necessarily to on stock price because we don't get much of a valuation. But in terms of the business returns that we have been able to produce. Unfortunately, this does not translate into a valuation because as you can see, there are not many companies and the companies that you mentioned, are trading at maybe a 30% or a 20% discount to net asset value, we trade at based on the net asset value, which I mentioned, we are trading at a 60% discounted net asset value. You're absolutely right that our valuation is quite terrible compared to our peers. Again, by the way, GasLog is an LNG company, so that's a completely different business. But, yes, all the product tanker and crude tanker companies trade much better than us. As far as listing in New York is concerned, that's all a separate discussion. But broadly your point on our getting worse valuations than our peers in western markets is 100% correct. I would 100% agree with it. Unfortunately, I don't know how we can convince investors of the value which is there in the stock, except to say that our net asset value is INR 500 and the stock is at INR 200.

Thank you. Ladies and gentlemen, that was the last question for today. I now hand the conference over to Ms. Anjali Kumar for closing comments. Thank you, and over to you, Anjali.

Thank you very much, everybody, for asking those insightful questions. And just to answer some of the suggestions that were made, we do have some glossary on our website. We also have some presentations on our website, which give us a lot of the basic maritime concept. So do feel free to go and check them out. And as usual, we will be uploading the transcript of this on the website. Thank you all.

Thank you, everyone.

Thank you very much. Ladies and gentlemen, on behalf of Great Eastern Shipping Company Limited, that concludes today's call. Thank you all for joining us, and you may now disconnect your lines.