India’s state-run defence shipbuilders—Garden Reach Shipbuilders & Engineers (GRSE) and Cochin Shipyard—rallied over 11% on Friday after reporting strong March quarter earnings and amid optimism over a potential multi-year order boom in the defence sector.GRSE shares climbed as much as 11% to Rs 2,507 on the BSE, extending a three-session rally that has seen the stock surge 31% since it announced its quarterly and annual earnings after market hours on May 13.The defence PSU reported a twofold jump in net profit at Rs 224 crore for the March quarter, up from Rs 112 crore in the same period last year. Revenue from operations grew 62% year-on-year to Rs 1,642 crore, while EBITDA more than doubled to Rs 335 crore from Rs 166 crore. The company also declared a total dividend of 138.5% of paid-up share capital, compared to 93.6% last year, with a recommended payout of Rs 4.90 per share.Shares of Cochin Shipyard climbed 12.6% to Rs 2,040 on Friday, extending their winning streak to a fifth straight session. The stock had gained 4% on Thursday following the company’s quarterly earnings.Cochin Shipyard reported a 27% year-on-year increase in consolidated net profit at Rs 287.18 crore for the March quarter, compared with Rs 258.88 crore in the same period last year. Revenue from operations rose 36.7% to Rs 1,757.65 crore.The board of Cochin Shipyard also proposed a final dividend of Rs 2.25 per equity share for FY2024-25, to be paid within 30 days of its declaration at the company’s annual general meeting, according to a regulatory filing.Cochin Shipyard shares have risen 41% over the last six sessions.Defence orders seen tripling by FY27The earnings-driven rally has also been underpinned by broader optimism in the sector, with Antique Stock Broking projecting a sharp expansion in the order books of India’s defence shipbuilders. The brokerage expects combined orders for GRSE, Cochin Shipyard and Mazagon Dock Shipbuilders to more than triple by FY27, supported by rising indigenization, a strong policy framework, and a robust defence capex pipeline.The brokerage attributed the surge in defence stock prices since April to rising geopolitical tensions and the clearance of Rs 54,000 crore worth of defence contracts.While Antique reiterated its ‘buy’ ratings on GRSE and Mazagon Dock, it maintained a ‘hold’ on Cochin Shipyard due to limited visibility on the timeline and scope of the proposed second indigenous aircraft carrier (IAC-II). Still, the rally in shares has been broad-based—Mazagon Dock Shipbuilders also rose as much as 5.9% to Rs 3,370 on the BSE on Friday.“We see large orders being placed in FY26–27 led by the ordering of six submarines under P75I, three Kalvari-class submarines, next-generation Corvettes, and P-17B Frigates, besides a host of smaller vessels,” the brokerage said.Antique expects stocks to trade up to 45 times FY27 core earnings, backed by a robust defence capex pipeline and strong policy support.Also read | Mazagon Dock, GRSE, Cochin Shipyard set for 3x order boom by FY27 amid defence windfall: Antique Broking(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
- News Source Indiatimes (Click to view full news): CLICK HERE
0 Comments:
Leave a Reply