Texmaco Ltd, the Indian wag- on maker controlled by the KK Birla group, and France
The venture will buy wagons from private container-train operators or private rail operators and lease the same wagons to them, similar to an arrangement followed in the airline industry.
Carriers often sell their planes to aircraft-leasing companies and take the same planes back on lease to avoid capital costs on their books. This also helps the airline to keep the fleet young as they have the option of ending the lease contract after a specific period of time.
“We are talking to Touax for a possible joint venture but cannot disclose the contours of the alliance as we have signed a non- disclosure agreement with them”, said a senior Texmaco official, who declined to be identified.
The joint venture expects to record $500 million (`2,260 crore) in revenue in the second year of operation, according to a senior Touax executive, who also declined to be named. “Under the joint venture agreement, Texmaco will manufacture the wagons while we will take the wagons to the market”, he said. “Whenever there is a change in design of the wagon, the companies can stop renewing the lease contract and opt for new ones. This was not possible till now. Both executives declined to provide further details on the in- vestments.
The venture follows a railway ministry plan to encourage participation of private companies in the railway industry. The government has allowed 13 private operators and three state-owned companies--Container Corp. of India Ltd, Central Railside Warehouse Co. Ltd, a unit of Central Warehouse Corp. Ltd, and Krishak Bharati Cooperative Ltd--to run container trains on various routes.
Privately owned companies that run container trains include Gateway Distriparks Ltd, Boxtrans Logistics (India
“Pure wagon leasing has very little scope in India as there are very limited private container train operators in India,“ said Sachin Bhanushali, president of Gateway Rail Freight Ltd, the rail unit of Gateway Distriparks Ltd. “But this tie-up and scope of business is better in the context of the ministry of railways modifying the existing wagon leasing scheme.“
Bhanushali said he is aware of Texmaco's venture with Touax.
“It's good news for the industry as now train operators can focus on their core business and can turn asset-light,“ said Bhanushali. “Civil aviation in India
Suhas Kumar, adviser, freight marketing, Indian Railways hoped that this joint venture will bid for wagon-leasing scheme licences.
On 22 February, Mint had re- ported that the railway ministry has eased entry norms and licence conditions for wagon- lease operators, after a 2008 plan to allow private wagon-lease companies found few takers be- cause of stringent rules.
The promoters of Texmaco and HT Media Ltd, which publishes Mint, are closely related.