1. At a Glance
Essar Shipping is the corporate equivalent of that Titanic meme—“still sailing, just without the iceberg.” With accumulated losses of ₹6,821 crore, defaulted loans, and SFIO knocking on the door for investigations, the company survives by selling off assets faster than a clearance sale at Big Bazaar. Yet, the stock trades at ₹26 with a P/E of 3.79, mostly because retail investors can’t resist the Essar surname.
2. Introduction
Once pitched as an integrated logistics giant with sea transportation, oilfield rigs, and trucks, Essar Shipping today looks like a garage sale of half-broken vessels, disputed rigs, and “consultancy services” to related parties.
The company is a masterclass in financial acrobatics—turning other income (₹859 crore in FY25) into its main earnings engine, while real operations limp at ₹9.4 crore in sales. In FY23, lenders came calling, lawsuits piled up, and assets were sold to Mauritius-based entities. Now the Serious Fraud Investigation Office (SFIO) has joined the party, asking: “Bhai, tum log kar kya rahe ho?”
So, is this a shipping company or an offshore finance soap opera?
3. Business Model (WTF Do They Even Do?)
Essar Shipping operates across three “verticals”:
- Fleet Operating & Chartering– Tankers and dry bulk carriers for coastal/international voyages. In FY23, contributed just ~5% of revenues. Translation: ships are either gone or mothballed.
- Oilfield Services– Land rigs and semi-submersible rigs. This segment contributes ~95% of revenue, mostly from Indonesia. Rigs keep the company alive.
- Logistics Services– Trucks, trailers, tippers. Small fry compared to rigs.
Bonus: They also “consult” for other Essar entities in Mauritius and Dubai. Essentially, Essar Shipping is less a shipping company and more a holding cell for rigs + legal disputes.
4. Financials Overview
| Metric | Jun 2025 (Latest Qtr) | Jun 2024 (YoY) | Mar 2025 (QoQ) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 1.69 | 2.54 | 2.00 | -33.5% | -15.5% |
| EBITDA (₹ Cr) | -5 | -4 | -30 | -25% | +83% |
| PAT (₹ Cr) | 27.4 | 8.8 | 13.0 | +211% | +111% |
| EPS (₹) | 1.32 | 0.42 | 0.62 | +214% | +113% |
Commentary:Sales are peanuts, OPM is hilariously negative (-529%), but PAT
is positive thanks to “other income.” So, yes, profits exist—but only if you ignore the actual business.
5. Valuation (Fair Value RANGE Only)
- P/E Method: EPS (TTM) = ₹34.9. P/E = 3.79. On surface, FV looks ₹100+ if you apply industry PE ~13. But EPS is inflated by other income.
- EV/EBITDA: EV = ₹2,162 Cr, EBITDA = -₹50 Cr. EV/EBITDA not meaningful.
- DCF: Core business generates negligible cash flows. Only asset sales/one-offs contribute. DCF FV range = ₹5–₹15.
👉Final FV Range: ₹5 – ₹25/share (Educational Only).
6. What’s Cooking – News, Triggers, Drama
- SFIO Investigation (Aug 2025):Company under probe for fraud. Management says “no material impact.” Translation: “We’ll see.”
- Disposals:Subsidiaries in Bermuda, Dubai, Mauritius sold for USD 100+ mn. Think of it as a fire sale to related entities.
- NCD Issue:₹400 Cr debentures issued in FY23 by converting loans—financial engineering at its finest.
- Outlook:Exploring “in-chartering” opportunities. Which means: instead of owning ships, they’ll rent someone else’s. That’s like Uber claiming it’s in aviation by booking Air India tickets.
7. Balance Sheet
| Metric (Mar 2025) | ₹ Cr |
|---|---|
| Assets | 300 |
| Liabilities | 1,948 |
| Net Worth | -2,587 |
| Borrowings | 1,631 |
