2 Reasons -
1 ) At the time of doubling of the Kakinada-Samalkot line, they planned to construct the Kakinada-Pithapuram line and have the line branch off from Sarpavaram. The line would branch out from SPVM (without going to Kakinada Town station) and meet the main line at Chandrampalem near Pithapuram. SPVM was to become the bypass station for Kakinada, like Duvvada for Vizag and Rayanapadu for Vijayawada. But the line was cancelled as it was deemed to be of not much use.
2) When the SLO bypass was opened, if a freight...
more... train had to use the bypass line going from COA towards VSKP, then the train had to wait at CCT station or at SLO outer until the mainline was cleared. This would block the Kakinada-SLO line and trains going towards RJY would have to wait until the freight train took the bypass. So, SPVM was constructed with loop lines so that freights going towards VSKP using the bypass could be parked here if the mainline was not clear. This would allow trains going towards RJY to go through without waiting for the VSKP bound freights to clear the tracks.