Shipping companies to witness 5-7 per cent decline in revenue in FY 2025

As per reports, the domestic shipping companies are likely to witness a further 5-7 per cent decline in revenue in FY 2025, amid the normalisation of the rates. This follows a steep 23-25 per cent fall in their revenue in FY 2023, after a 35 per cent growth in FY 2022 when charter rates improved and demand increased from China during post covid-19 pandemic period. CRISIL reported that the average operating margin may continue to moderate to 33-35 per cent in FY 2025, which will be driven mainly by the correction in charter rates. However, it will remain higher than the pre covid-19 pandemic levels of 25-30 per cent. The shipping fleet of domestic companies is dominated by tankers that carry crude oil and petroleum products (contributing to around 70 per cent of total deadweight tonnage), followed by dry bulk carriers carrying unpackaged commodities such as coal, iron ore and grains (around 20 per cent), while the remaining is distributed between container ships, gas carriers and others.