Rs 22,000 crore order book and FIIs & DIIs increase stake: This multibagger shipbuilding & repair company bags order worth Rs 250 crore from Adani Harbor Services Ltd

The stock gave multibagger returns of 700 per cent in just 1 year whereas BSE Sensex Index is up by 18 per cent. Investors should keep an eye on this shipbuilding stock.

Udupi Cochin Shipyard Limited (UCSL), a subsidiary of Cochin Shipyard Limited (CSL), has secured a significant order from Ocean Sparkle Limited (OSL), a leading Indian tug operator owned by Adani Harbor Services. This is not the first time UCSL has impressed OSL with their work. Previously, UCSL successfully delivered two 62 T bollard pull ASD tugs to OSL ahead of schedule, which are now operating at Paradeep Port and New Mangalore Port. The order is worth approx. Rs 250 crore.

This new contract involves the construction of three powerful 70 T bollard pull ASD tugs. These vessels will boast impressive features like a length of 33 meters, a beam of 12.2 meters, and a draft of 4.2 meters. They will be equipped with twin main engines, powerful thrusters, and a range of winches, generators, and firefighting equipment. Notably, these tugs will be designed by Robert Allan Limited, a world leader in harbour tug design, and built to meet the standards set by the Indian Register of Shipping (IRS) and the Approved Standard Tug Design and Specifications (ASTDS) established by the Indian government. This aligns with the government's Aatmanirbhar Bharat and Make in India initiatives, promoting self-reliance and domestic manufacturing. UCSL is the first shipyard to construct tugs complying with these new ASTDS regulations.

Furthermore, UCSL has ongoing projects with other clients. They are currently building a second 70 T bollard pull ASD tug for Polestar Maritime Limited, following the successful delivery of the first vessel named "Konna Star" which is already operational at Deendayal Port, Kandla. This demonstrates UCSL's ability to deliver high-quality vessels on time and secure repeat business. Overall, UCSL has achieved remarkable progress since its revival by CSL in September 2020, and its impressive order book reflects its growing reputation in the shipbuilding industry.

Cochin Shipyard Ltd (CSL) is a leading player in the construction of all kinds of vessels, repairs and refits of all types of vessels including periodic upgradation and life extension of ships. The company has a market cap of over Rs 51,000 crore and as of December 31, 2023, the company’s order book stands at approx. Rs 22,000 crore. Furthermore, the shares of CLS underwent a stock split of equity shares from a face value of Rs 10 to a face value of Rs 5 on January 10, 2024.

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According to Quarterly Results, net sales increased by 114.3 per cent to Rs 1,286.05 crore and net profit increased by 558.1 per cent to 258.88 crore in Q4FY24 compared to Q4FY23. In its annual results, net sales increased by 62 per cent to Rs 3,830.45 crore and net profit increased by 157 per cent to Rs 783.28 crore in FY24 compared to FY23.

The President of India owns 19,16,86,928 shares or 72.86 per cent stake in the company. As of March 2024, FIIs have increased their stake to 5.23 per cent and DIIs increased their stake to 2.45 per cent compared to 4.11 per cent and 2.20 per cent respectively in December 2023. The stock gave multibagger returns of 700 per cent in just 1 year whereas BSE Sensex Index is up by 18 per cent. Investors should keep an eye on this shipbuilding stock.

Disclaimer: The article is for informational purposes only and not investment advice.