MSC-Adani terminal deal at Ennore poised to boost South India trade flow

CHENNAI : MSC’s 49% stake acquisition in Adani Group‘s container terminal at Ennore Port, also known as Kamarajar Port, has the potential to boost direct calls out of India’s southern corridor as volumes build.

Ennore is located about 15 miles north of Chennai. Maersk is the main liner customer for the Ennore terminal (AECTPL) at present, with two weekly sailings, while CMA CGM recently added a call there via its NEMO service connecting to North Europe and the Mediterranean.

Under the deal, MSC through its terminal arm Terminal Investment Ltd. (Til) will invest Rs. 247 crore (US$30 million) for the share purchase, according to an APSEZ announcement.

MSC already has a terminal joint venture with APSEZ at Mundra Port, known as AICTPL.

“APSEZ enjoys a strong partnership with TiL and MSC, built on mutual trust and transparency, as reflected in our growing alliance. With this second joint venture, we are now further deepening this strategic partnership in one of the fastest growing container terminal markets in the south,” said APSEZ CEO Karan Adani in a statement.

Adani also noted, “We aim to replicate the AICTPL terminal’s success at the Ennore Container Terminal and service the trade needs of the South Indian market,”

He went on to add, “This strengthening of our association with the world’s largest shipping company reflects APSEZ’s robust vision of accelerating sectoral growth through a transparent business approach.”

AECTPL had remained a non-starter for almost a year after commencing operations in 2017, due to carrier concerns over high tariffs there.

MSC has thus far concentrated on expanding service networks out of Nhava Sheva (JNPA) and Mundra, with the latter gaining the most from its regional transhipment activity.

“We are highly pleased to strengthen our partnership with APSEZ, India’s largest private sector port operator,” said Ammar Kanaan, CEO of TiL.

Kanaan added, “This association will enable us to further improve TiL’s presence in one of the world’s fastest growing economies and strengthen our offering to customers in the Indian subcontinent.”

AECTPL is equipped with a berth length of 400 metres and an annual handling capacity of 800,000 TEUs, going up to 1.4 million TEUs at full build-out.

Industry sources believe that MSC’s entry at Ennore as a terminal partner for Adani — known for aggressive marketing strategies — could dramatically alter supply chain dynamics for southern India shippers who have traditionally used costly transhipment options over Sri Lanka’s Colombo Port in the absence of direct mainline calls.

As more direct, origin-to-destination networks take ground on the Indian coastline, Colombo could lose some portion of its high-stakes transhipment business.