2:1 stock split in FY24 & Rs 22,000 crore order book: Multibagger shipbuilding & repair stock jumps 12 per cent with heavy volume; DIIs increase stake in Q1FY25
The stock gave multibagger returns of 611 per cent in just 1 year whereas BSE Sensex Index is up by 21 per cent.
On Wednesday, shares of Cochin Shipyard Ltd (CSL) gained 12.43 to Rs 2,388.05 per share from its intraday low of Rs 2,123.95. The stock’s 52-week high is Rs 2,977.10 and its 52-week low is Rs 316.50. At the closing bell, shares of the company were trading at Rs 2,349.15 per share, up 2.60 per cent from its previous closing of Rs 2,289.65 with a spurt in volume by more than 2.15 times on BSE. The company has not made any significant announcements of late. Hence, the rally in the share price could be driven purely by the market forces.
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 61,000 crore and as of March 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.
Udupi Cochin Shipyard Limited (UCSL) secured a significant international order for eight 6,300 deadweight tonnage (TDW) dry cargo vessels from Wilson ASA, Norway. This follows an earlier contract for six 3,800 TDW vessels currently under construction. The 100-meter-long vessels will be designed for eco-friendly coastal cargo transport in Europe and are expected to be delivered by September 2028 for a total contract value of approximately Rs 1,100 crore.
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Following the early delivery of two powerful tugboats for Ocean Sparkle Limited, UCSL secured a new order worth Rs 250 crore to build three even stronger 70 T bollard pull tugs. These advanced vessels will be built according to India's new regulations and designed by Robert Allan Limited. Furthermore, UCSL's success extends beyond Ocean Sparkle, with a repeat order from Polestar Maritime for a second 70 T tug following the on-time delivery of their first vessel, "Konna Star". This string of successful projects, including being the first shipyard to comply with the new tug standards, highlights UCSL's remarkable progress since its revival in 2020 and solidifies its position as a leader in Indian shipbuilding.
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 June 2024, DIIs have increased their stake to 2.50 per cent compared to 2.45 per cent respectively in March 2024. The stock gave multibagger returns of 611 per cent in just 1 year whereas BSE Sensex Index is up by 21 per cent. Investors should keep an eye on this shipbuilding stock.
Disclaimer: The article is for informational purposes only and not investment advice.
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