INDUSTRY STRUCTURE AND DEVELOPMENTS
India stands as a dominant force in the global ship-breaking sector, with Gujarat housing the largest and most prominent ship-breaking yards, especially the Alang-Sosiya yard, recognized as one of the worlds biggest ship recycling centers. Ship breaking, also known as ship demolition, ship recycling, or ship cracking, involves dismantling retired vessels to extract valuable scrap metal and break down their massive structures.
In recent years, global trade and shipping have witnessed consistent growth, driven by the forces of globalization and industrialization. This surge has, in turn, led to an increase in shipbuilding activity. The typical operational life of a ship ranges between 25 and 30 years, after which the vessel is often retired. This decommissioning can be driven by safety concerns, economic factors, or sometimes due to damage or accidents. The decommissioning process usually involves auctioning the ship, which is then sent to a recycling yard for dismantling. Depending on the ships size and type, the dismantling process can be time-consuming and labor-intensive.
In response to growing safety and environmental concerns, the Indian government has enacted several regulations to improve practices within the ship-breaking industry. Notable frameworks include the Ship Breaking Code (Revised) 2013 and the Recycling of Ships Act 2019, which set standards to enhance safety and environmental protocols. To keep pace with these regulations, Indian ship-breaking yards are increasingly adopting advanced techniques and machinery aimed at improving both safety and efficiency. This includes the introduction of high-tech cutting tools, better waste management systems, and the mechanization of key processes. Alongside these innovations, stronger safety protocols, enhanced protective equipment, and regular safety audits are becoming standard practice. Training programs are also growing in importance to ensure workers are equipped with the necessary skills and knowledge.
Indias burgeoning steel industry is intricately linked to its economic development. Steel consumption serves as a critical indicator of industrial and infrastructural growth, with the metal being crucial not only for traditional sectors like construction and transportation but also in specialized fields such as power generation, petrochemicals, and fertilizers. India holds a pivotal position in the global steel market, fueled by the establishment of cutting-edge steel mills, expansion of production capacities, the modernization of existing facilities, and improved energy efficiency. Furthermore, there is enhanced integration with global raw material markets, solidifying Indias role as a global steel powerhouse.
Global Overview:
Geographically, the global ship breaking market is segmented into Asia Pacific, Europe, North America, Latin America, and the Middle East & Africa. Market dynamics vary significantly between developed and developing regions. In developed regions like Europe and North America, ship dismantling is highly regulated and capital-intensive, with strict environmental and safety standards that often render the process economically unfeasible. Conversely, in developing countries such as India, Bangladesh, China, and Pakistan, the industry has expanded rapidly due to comparatively lax regulatory enforcement and lower operational costs. As a result, Asia Pacific has emerged as the dominant hub for ship breaking, with these countries leading global activity. Outside of Asia, Turkey also plays a significant role in the global market, particularly in environmentally compliant ship recycling.
The ship-breaking industry was valued between USD 4.08 billion and USD 7 billion in 2024, reflecting variations across different industry sources. Projections suggest strong upward momentum, with the market expected to grow to USD 13 billion by 2030, at a CAGR of approximately 7.4% from 2025 to 2030.
Asia Pacific continues to dominate the global ship recycling market, holding approximately 58% of the total market share as of 2024. Key contributors in this region include India, Bangladesh, China, and Pakistan, which serve as major dismantling hubs due to cost-effective labor and large coastal facilities. South Asia, in particular, plays a pivotal role India, Bangladesh, and Pakistan together handle an estimated 70 90% of global ship recycling tonnage, underscoring their central importance to the industry.
Europe also maintains a strong presence, with countries like Turkey, the Netherlands, and Norway benefiting from stringent environmental regulations and a focus on sustainable practices. In North America, especially the United States, efforts to expand ship recycling capacity are gaining momentum due to concerns over an aging fleet and increasing environmental obligations.
Meanwhile, emerging ship recycling hubs are developing in the Middle East, Africa, and Latin America. Notably, Saudi Arabia is making strategic investments in environmentally advanced infrastructure, such as the Wreckdock facility in Al Jubail, positioning itself as a future leader in green ship recycling.
Domestic Overview & Market Size:
India is a global leader in ship recycling, with a well-established industry centered primarily in Alang, Gujarat, home to one of the worlds largest shipbreaking yards. The country holds a strategic position in the global ship recycling market, not only due to its extensive coastline and cost-effective labor but also because of its progressive regulatory framework and growing commitment to environmentally sustainable practices.
Indias ship recycling sector has undergone major transformation following its accession to the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships in 2019. This move has significantly improved its global credibility, attracting more vessels from shipowners seeking compliant dismantling under international norms.
In terms of economic size, Indias ship recycling market was valued at approximately USD 1.8 billion in 2024 and is expected to grow at a CAGR of 6 7% over the next five years. The sector benefits from rising global fleet retirement due to decarbonization targets, stricter international shipping regulations, and high demand for scrap steel in domestic infrastructure and construction sectors.
Government initiatives such as the Recycling of Ships Act, 2019, the push toward green recycling practices, and infrastructure upgrades at Alang have further strengthened Indias competitive edge. The capacity at Alang alone enables the recycling of over 4.5 million gross tonnage annually, positioning India as a preferred destination for end-of-life vessels from Europe, East Asia, and the Middle East.
Looking ahead, Indias domestic ship recycling industry is expected to continue its upward trajectory, driven by sustainability mandates, global fleet renewals, and its ability to meet both economic and environmental benchmarks.
Government Initiatives
In the year 2024, the Indian government introduced several initiatives that directly and indirectly support the shipbreaking industry. Most notably, the proposed Shipbuilding Policy 2.0 includes a recycling credit note scheme, offering up to 40% of a ships scrap value as a redeemable credit if the vessel is dismantled in India. This measure is designed to incentivize shipowners to choose Indian recycling yards and strengthen the domestic shipbreaking ecosystem. Additionally, the ongoing implementation of the Recycling of Ships Act, 2019, and alignment with the Hong Kong Convention have further improved environmental compliance and operational standards at major shipbreaking hubs like Alang, enhancing their appeal on the global stage.
While other initiatives such as the 337 crore support under the Shipbuilding Financial Assistance Policy (SBFAP), port infrastructure upgrades (e.g., Vadhavan Port, Sagarmala projects), and green shipping incentives under Panch Karma Sankalp are not directly focused on shipbreaking, they indirectly benefit the industry. For example, improved port connectivity facilitates the movement of end-of-life vessels, and the push for greener vessels accelerates the retirement of older ships feeding the supply pipeline for recycling. Collectively, these initiatives reinforce Indias position as a global leader in ship recycling by encouraging responsible dismantling, boosting demand for scrap steel, and aligning with sustainability goals.
The Government of India promulgated the “Maritime India Vision 2030” (MIV 2030), subsuming within it, the SAGARMALA mega-project, and including the enhancement of the countrys ship recycling capacity. This vision document promotes the concept of ‘Waste to Wealth through modification of Bureau of Indian Standards (BIS) regulations and the development of ship recycling infrastructure. The document also identified three major interventions to drive demand in the ship recycling industry:
Relaxation in BIS (steel scrap standards) to enhance the yield per tonne of scrap and exempt ship-scrap use in re-rollable bar manufacturing based on mechanical strength and quality in lieu of the earlier-specified norms of metallurgical history.
Redevelopment of plots at Alang-Sosiya and the creation of a ship-repair cluster on the east coast of India to enhance market share.
Set up a facilitation centre to promote Indias ship recycling industry through the hosting of trade fairs and exhibitions.
OPPORTUNITY AND THREAT
The shipbreaking industry plays a vital role in generating economic value, driving technological advancement, and promoting sustainable practices. As a labor-intensive sector, ship recycling creates substantial employment opportunities particularly in coastal regions supporting both direct and indirect livelihoods. It also contributes to resource recovery by supplying recycled steel, which is essential for meeting growing domestic demand.
Indias steel industry is poised for significant growth, propelled by accelerated infrastructure development, rapid urbanization, and a nationwide shift toward sustainable manufacturing. As one of the worlds fastest-growing economies, India is on track to become the third-largest globally by 2030. This growth trajectory positions the steel sector as a cornerstone of national development. Increased infrastructure investments are expected to raise domestic steel consumption, reduce logistics costs, and create a self-sustaining cycle of supply and demand. Government initiatives like Atmanirbhar Bharat and favorable demographic trends will further boost steel consumption, particularly through rising per capita usage. Our company is strategically aligned with these developments, continuously enhancing its capabilities to capitalize on emerging opportunities.
India benefits from abundant raw material reserves, a skilled labor force, and a rapidly expanding market. Under the National Steel Policy 2017, the country aims to achieve a production capacity of 300 million tonnes and a per capita steel consumption of 158 kg by FY 2030 31. Demand is expected to increase not only from traditional sectors but also from emerging industries, supported by government-driven investments in housing, mobility, and rural development. Notably, the policy also targets a doubling of rural steel consumption from 19.6 kg to 38 kg per capita by FY 2030 31.
As Indias economy continues to open up, global expansion opportunities are emerging. In response, our company is strengthening its production capacity while addressing the global challenge of climate change through environmentally responsible operations. Emphasis on innovation in processes, products, and business models, backed by robust technology management, is central to meeting evolving customer expectations and sustainability goals.
SEGMENT WISE PERFORMANCE
Segmental Review
The Groups business segments are identified based on the geographic locations of its units and the internal business reporting system as per Ind AS 108. Business segments of the company are primarily categorized as: Mumbai and Bhavnagar.
This Consolidated Segment Information includes Industrial Oxygen & Trading Segment pertains to subsidiary of the company.
Rs. In Lakhs
Particulars |
Mumbai | Bhavnagar | Industrial Oxygen & Trading | Total |
Segment Assets |
15,975.34 | 609.16 | 1.04 | 16,585.53 |
Segment Liabilities |
1,897.81 | 17.92 | 0.05 | 1,915.78 |
Revenue from External |
878.78 | 22.76 | - | 839.99 |
Source (Excluding Inter Segment Revenue) |
||||
Segment Results Before Interest and Taxes |
680.70 | -163.43 | -0.10 | 517.18 |
i. Mumbai:
During the year under review, the Mumbai Unit has performed well in term of net profit margin, this segment has achieved revenue of Rs. 878.78/- Lakhs and result achieved Rs. 680.70/- Lakhs. ii. Bhavnagar:
During the financial year 2024-25, ship-breaking unit at Alang Ship Breaking Yard, Bhavnagar has achieved revenue of Rs. 22.76/- Lakhs as compared to 8,456.43/- Lakhs in the previous year. However, the result was negative amounting to Rs. (163.43) /- Lakhs in the current year as compared to Rs. (227.66)/- Lakhs in the previous year. Throughout the year, the international market for old ships showed some volatility, but the management navigated these fluctuations carefully. They strategically timed their ship purchases and built up a robust inventory to position the company for better profitability in the future. Additionally, trading activities were conducted in Bhavnagar. Looking ahead, the management anticipates a stable shipbreaking industry, bolstered by an expected economic upturn that should drive higher demand for iron and steel. This positive outlook will support the companys continued growth trajectory.
iii. Industrial Oxygen & Trading:
This segment of the company pertains to the subsidiary of the company. This segment has not achieved revenue during the year and incurred loss of Rs. 0.10 Lakhs during the year under review.
OUTLOOK
India continues to maintain a leading position in the global ship recycling market, with the Alang ship breaking yard in Gujarat remaining one of the worlds largest, processing approximately 450 ships annually. In line with growing environmental consciousness, the Government of India is actively working to enhance sustainability within the sector by improving ship recycling practices.
Recognized as a priority sector under the Vision 2047 framework, the ship recycling industry contributes significantly to meeting the countrys steel demand while also generating substantial direct and indirect employment for both skilled and unskilled labor. However, aligning with evolving international environmental and safety standards remains a key challenge.
The industry is undergoing a transformation marked by greater focus on modernization, environmental compliance, and worker safety. Future progress is expected to center on implementing more efficient and sustainable practices, upgrading infrastructure, and ensuring adherence to global standards such as the Hong Kong International Convention.
As a vital component of Indias industrial ecosystem, the ship breaking sector presents both challenges and opportunities. Amid rising global concerns over sustainability, the industry has the potential to emerge as a key economic driver. With strategic investments, technological upgrades, and stronger collaboration among regulatory authorities, ship recyclers, and technical experts, the sector can significantly enhance its global competitiveness.
Adoption of internationally recognized protocols for waste management and worker safety will be crucial in driving long-term sustainability. Additionally, the establishment of specialized facilities for recycling bulk waste will help manage the growing costs associated with obsolete vessels, especially in light of increasing international competition and environmental obligations.
The companys leadership remains optimistic about the future, buoyed by the positive trajectory of the iron and steel sectors both in India and globally. Management expects the ship recycling industry to stabilize in the coming years. With anticipated economic growth and rising steel demand, the sector is well-positioned to support the companys ongoing expansion and long-term sustainability objectives.
RISK AND CONCERN
Over and above the economic risks the shipping industry is impacted by numerous short term and regional factors, like weather changes, Oxygen Supply problems etc. This results in great amount of volatility in the freight market, which in turn impacts the Companys earnings. The global economy is in uncertain territory, and not showing signs of picking up sharply in shorter span of time.
Indias economy has also felt the impact of global economic uncertainties. Key risks for the industry include the global recessionary trend, economic slowdown, rising financial costs, and fluctuations in the availability and cost of raw materials like steel and labor.
The Company does not apprehend any inherent risk in the long run, with the exception of certain primary concerns that have afflicted the progress of our industry in general, like:
Shortage of Labour
Rising manpower and material costs, Approvals and procedural difficulties. Lack of adequate sources of finance.
The Companys risks are rooted in the shipbuilding industrys inherent dependence on global trade and the cyclical nature of related sectors like oil, natural gas, shipping, and transportation. Offshore Industry continues to be in the trough.
Macroeconomic Risks
Overcapacity and oversupply in the global steel industry as well as increased levels of imports may adversely affect steel prices, impacting profitability.
Operational Risks
The steel industry is capital-intensive and relies heavily on maintaining critical assets. It faces high fixed costs and price volatility in raw materials and energy. Disruptions in raw material supply can negatively impact profitability. Additionally, failures in critical information systems or servers could disrupt operations, and conventional maintenance practices may not ensure optimal equipment reliability, leading to unplanned operational interruptions.
Supply Chain Risk
The supply chain network is susceptible to physical and environmental damage, trade restrictions due to geopolitical tensions, and supplier disruptions. Ongoing infrastructure development and dependence on outsourced partners may also cause operational issues.
Safety Risk
Non-adherence to process and workforce safety requirements, safety laws and regulations may impact business continuity and reputation.
INTERNAL CONTROL SYSTEM AND THEIR ADEQUACY
Internal financial control systems of the Company are commensurate with its size and nature of its operations. These have been designed to provide reasonable assurance with regard to the orderly and efficient conduct of its business including adherence to the Companys policies, safeguarding of its assets, prevention and detection of frauds and errors, accuracy and completeness of the accounting records and the timely preparation of reliable financial information and disclosures.
Systems and procedures are periodically reviewed and these are routinely tested by Statutory as well as Internal Auditors and cover all functions and business areas. The Audit Committee reviews adequacy and effectiveness of the Companys internal control environment and monitors the implementation of audit recommendations, including those relating to strengthening of the Companys risk management policies and systems. During the year under review, no material or serious observation has been received from the Statutory Auditors and the Internal Auditors of the Company on the inefficiency or inadequacy of such controls.
FINANCIAL PERFORMANCE & ANALYSIS
The Companys financial performance for the year ended March 31, 2025 is summarized below:
Standalone & Consolidated Ind AS Financial Results: Review and Analysis
(Rs. In Lakhs)
Particular |
Standalone | Consolidated | ||
| For the financial year ended 31.03.2025 | For the financial year ended 31.03.2024 | For the financial year ended 31.03.2025 | For the financial year ended 31.03.2024 | |
Revenue from operations |
22.45 | 14,863.19 | 22.45 | 14,863.19 |
Other Income |
817.55 | 1081.96 | 817.55 | 934.78 |
Total Revenue |
839.99 | 15,945.15 | 839.99 | 15,797.98 |
Cost of raw materials consumed |
- | 8,498.89 | - | 8,498.89 |
Purchase of Stock in trade |
- | 6,393.24 | - | 6,393.24 |
Changes in inventories of finished goods, stock in trade, work in process |
0.23 | -175.94 | 0.23 | -175.94 |
Manufacturing Expenses |
35.76 | 105.92 | 35.76 | 105.92 |
Employee benefits expenses |
34.80 | 231.29 | 34.80 | 231.29 |
Finance costs |
278.85 | 248.42 | 278.85 | 248.42 |
Excise Duty |
- | - | - | - |
Depreciation and amortization expenses |
111.08 | 116.53 | 111.08 | 116.53 |
Other expenses |
140.95 | 131.04 | 82.93 | 131.05 |
Total Expenses |
601.66 | 15,549.38 | 543.65 | 15,549.40 |
Share of profit/ (loss) from associates |
- | - | -58.02 | 147.18 |
Profit / (Loss) before tax |
238.33 | 395.77 | 238.33 | 395.76 |
Less: Current Tax |
87.32 | 77.74 | 87.30 | 77.71 |
Less: Tax of earlier year |
0.45 | - | 0.49 | 0.10 |
Less: Deferred Tax |
-9.92 | -4.63 | -9.92 | -4.63 |
Profit / (Loss) after tax |
160.47 | 322.66 | 160.46 | 322.59 |
Other Comprehensive Income |
11.41 | -5.90 | 11.41 | -5.90 |
Total Comprehensive Income for the year |
171.88 | 316.76 | 171.87 | 316.69 |
Earnings Per Share (Face Value of Rs. 10/- each) |
||||
-Basic |
2.60 | 5.23 | 2.60 | 5.23 |
-Diluted |
2.60 | 5.23 | 2.60 | 5.23 |
Standalone Cash Flow Analysis
(Rs. In Lakhs)
Particular |
For the financial year ended 31.03.2025 | For the financial year ended 31.03.2024 |
Net Cash Flow from Operating Activities |
(155.94) | 15.53 |
Net Cash Outflow from Investing Activities |
322.46 | 64.34 |
Net Cash Outflow from Financing Activities |
(454.92) | (1009.02) |
Net Cash Inform/(Outflow) |
(1,111.27) | (822.88) |
Business Overview
The company is in the business of ship breaking, trading and investment activities. During the financial year 2024-25, the sales turnover of the company was Rs. 22.45/- Lakhs as compared to previous year Rs. 14,863.19/- Lakhs. The prices in Iron and steel industry are gradually getting stabilized, but foreign currency and fluctuations in value of Indian Rupee vis-a-vis US Dollar remains a concerning area for the company even in the current year.
Surplus funds are also invested in new avenues of earnings in the form of partnership with other entities like in Real Estate and Redeveloping firms. At present the Company has partnership in Hariyana Air Products with 95% share, Orchid Lakeview Developers with 33.33% share, Goyal Hariyana Realty with 50% share, Whitefield Projects with 40% share and Swastik Developers with 33.33% share. The management is hopeful that the Company can earn reasonable return on these investments.
Standalone
F.Y 24-25 closed with Revenues of Rs. 22.45/- lakhs, PBT Rs. 238.33 /- lakhs and PAT of Rs. 160.47 /- lakhs.
Consolidated
F.Y 24-25 closed with Revenues of Rs. 22.45/- lakhs, PBT Rs. 238.33/- lakhs and PAT of Rs. 160.46/- lakhs.
Revenue
Your Company reported Revenue of Rs. 22.45/- lakhs during the year as compared to Rs. 15,945.15/- lakhs of the previous year. Revenue of current year has decreased by 99.85% as compared to previous year.
Finance Cost
Finance cost has increased from Rs. 248.42/- lakhs in the previous year to Rs. 278.85/- lakhs.
Depreciation
Depreciation during the year increased to Rs. 111.08/- lakhs from Rs. 116.53/- lakhs in previous year.
MATERIAL DEVELOPMENTS IN HUMAN RESOURCES
Your Company treats its “human resources” as one of its most important assets. We continuously invest in attraction, retention and development of talent on an ongoing basis. Our thrust is on the promotion of talent internally through job rotation and job enlargement. We believe in harnessing its leadership and people capabilities through sharp focus and initiatives on talent development. The total number of permanent employees as on March 31, 2025 were 23.
We review our talent based on their performance and potential to assess their readiness for future roles of higher scale and complexity. We believe in developing our employees through multiple experiences requiring them to handle scale and complexity. We have instituted this through varied job rotation and project roles. We have put in place various recognition initiatives for our employees to reward them on their noteworthy performance and contribution. Social awareness and cultural/sports programs are arranged regularly to create interest in living a meaningful life and release tensions.
Our Company is committed to providing work environment that ensures every employee is treated with dignity and respect and afforded equitable treatment. The Company is also dedicated at promoting a work environment that is conducive to the professional growth of its employees and encourages equality of opportunity. To foster a positive workplace environment, free from harassment of any nature, we have institutionalized the Anti-Sexual Harassment Framework through which we address complaints of sexual harassment at the workplace. We follow a gender-neutral approach in handling complaints of sexual harassment and we are compliant with the law of the land where we operate. We have also constituted Complaints Committee to consider and address sexual harassment complaints in accordance with Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.
SIGNIFICANT KEY FINANCIAL INDICATORS
For changes in 25% or more in key financial indicators as compared to the immediately previous financial year, refer note no. 5.14 to the Financial Statement for the year ended March 31, 2025.
CHANGE IN NET WORTH
The Companys Net worth stood at Rs. 13,293.02 Lakhs for the financial year 2024-25 as compared to Net worth of Rs. 13,621.14 Lakhs for the previous financial year 2023-24. In the current year, the Company earned a profit and hence change in return on Net worth of Company is 1.21 % compared to previous financial year.
CAUTIONARY STATEMENT
Statements in the Boards Report and the Management Discussion and Analysis describing the Companys objectives, projections, estimates, expectations or predictions may be “forward looking statements” within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to your Companys operations include global and Indian demand supply conditions, finished goods prices, feed stock availability and prices, cyclical demand and pricing in your Companys principal markets, changes in Government regulations, tax regimes, economic developments within India and the countries within which your Company conducts business and other factors such as litigation and your Company is not obliged to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent development, information or events or otherwise. The “Managements Discussion and Analysis” does not constitute a prospectus, offering circular or offering memorandum or an offer to acquire any shares and should not be considered as a recommendation that any investor should subscribe for or purchase any of the Companys securities.
CONCLUSION
At Hariyana Ship-Breakers Limited, innovation and responsibility have been at the core of building a sustainable enterprise and exploring possibilities towards creating a better future. We also deploy best available technologies and processes to drive resource efficiency and develop materials of the future which are superior, sustainable and affordable. We have focused on strengthening our balance sheet, upholding the highest standards in ethical and responsible business practices and striving towards a shared future of prosperity.
On behalf of the Board of Directors |
For Hariyana Ship- Breakers Limited |
Rakesh Reniwal |
Unnati Reniwal |
Managing Director |
Director |
(DIN: 00029332) |
(DIN: 00041306) |
Date: May 30, 2025 |
Place: Mumbai |
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