Singapore-based group has mostly been an asset provider, but it now has ambitions to become an operator
Shipowner and cash buyer Rakesh Tulshyan has been involved in shipping in one form or another for four decades.
Best known as one of the partners in Singapore-based cash buyer Wirana, he made a return to shipowning in 2010 with Sameer Ships, which quickly began buying up tankers of all types and sizes.
While Sameer Ships still exists as a vessel-owning entity, the owner’s shipping activities are now consolidated under the name Tulshyan Group. It has a diverse portfolio of 28 floating assets comprising nine tankers ranging from 1,000 dwt to 300,000 dwt, 13 offshore vessels, three livestock carriers, two ice-class multipurpose (MMP) vessels and a rig.
The company is preparing to take delivery of the first of three suezmax tanker newbuildings from Shanghai Waigaoqiao Shipbuilding in a couple of months, and it hints that more vessel acquisitions are imminent.
Tulshyan Group executive director Harry Blustein sat down with TradeWinds last week, accompanied by general manager Sudhanshu Aggarwal, chief financial officer Dipak Agarwal and legal executive Shruti Singh, to discuss how the company is managing to survive one of the worst markets shipping has ever known, and its future plans.
Blustein and his team are bullish about the company’s current status and what is in store. Until now it has focused on being a vessel provider, and Blustein credits a flexible approach and close relationships with clients as the key to its success. That helps explain why it has such a diverse fleet.
“The world has to go round, so there are always opportunities in all sectors. What we don’t do is say, ‘This is where it is at’ and bet the farm on it,” Blustein said.
Individual basis
“We look at each opportunity on an individual basis and if it brings value to the group, we move on it. It could involve assets that we don’t already have in the fleet.
“What will make us successful going forward is the ability to say no to a deal. The trick is not to be overly ambitious and take every deal that comes to us.”
Tulshyan’s deals with shipowners usually involve very long bareboat charters. It prefers 10-year deals, but, according to Aggarwal, it is comfortable with three years in the current market.
It is open to a variety of charter arrangements. Some ships have been done on sale and lease-back deals, others have been straight charters. In a break with tradition, the company recently fixed some out on time charter rather than bareboat.
The three suezmaxes that are set to join its fleet have been structured as a joint venture with Piraeus-based Westgate Tankers in a vehicle named RS Tankers. Tulshyan will own the ships, while Westgate will be their technical and commercial manager. The first of these, the 158,000-dwt RS Tara (built 2016), has been fixed to Vitol for two years in a deal estimated in the market to be worth $20.5m.
Vessel providers face a high degree of risk in the current market with the threat of charterers either defaulting on hire payments or handing back ships early. Tulshyan’s team claim that they have not suffered such problems and credit their old-school approach of knowing their clients and staying in touch with the market through the company’s Singapore headquarters and its network of offices in the US, Greece, United Arab Emirates, Pakistan, Bangladesh, India, Australia and China.
“When doing a deal, the most important thing for us is the client, not the asset,” Blustein said. “We put them through a full vetting process so that we can understand who they are and where they are going. By doing this, we know what is required for each client and what problems we could potentially face in doing a deal with them.”
Genuine request
Picking the right client is the start, adds Singh. “Our team have all been in shipping for a long time, so we can anticipate very well if there will be a default or some other problem, and know what approach we can take to prevent that. We are very fluid with clients and are willing to work with them if we know the request is genuine.”
Agarwal also credits Tulshyan’s conservative financial policies with giving it the ability to be more flexible with clients in need of help.
“By constantly addressing our debt and paying it down, we are not as leveraged as many other entities. That is why we are doing well today,” he said.
The Tulshyan Group has enjoyed success as a vessel provider, and its team now want to take the company further up the shipping value chain. It has started to do so over the past few years by upgrading its fleet.
When the company returned to shipowning in 2010, it focused on buying older ships that would be sold for scrap or conversion once their charter periods expired. Although it is not averse to buying older ships if the age profile suits a specific contract, the focus more recently has been on younger assets.
But the future could be potentially more exciting.
The company wants to diversify by tapping innovative opportunities using the diverse assets of its fleet and the experience of its team.
Without going into specifics, Blustein reveals that the company is eyeing opportunities that could see it branching into contractual work in the offshore space, contracts of affreightment or pool partnerships. “We have a good team that gives us the capability of doing this,” he said.
The company and its owner have already shown themselves to be adventurous. Outside of shipping it has investments in property, science and medicine.