This shipbuilding PSU stock was trending on October 10; do you hold it?

The share surged 14.81 per cent on the day.

On October 10, the share of Garden Reach Shipbuilders & Engineers Ltd surged 14.81 per cent and closed at Rs 450.4. The stock opened at Rs 386.1 and made an intraday high and low of Rs 465 and Rs 383.4, respectively.   

Garden Reach Shipbuilders & Engineers Ltd is India's premier shipbuilding firm, overseen by the Ministry of Defence. It primarily serves the Indian Navy and Coast Guard's shipbuilding requirements. 

The company has eight units, seven of which are in the Kolkata area and one in Ranchi, Jharkhand. It operates into three segments- shipbuilding and ship repairing, engine assembling and testing, and engineering products.  

For FY22, the company reported a net sale of Rs 1758 crore and a net profit of Rs 190 crore. For the June quarter, revenue stood at Rs 580 crore, a YoY jump of 90 per cent. While Q1FY23 net profit was recorded at Rs 50 crore.  

As per FY22, the company has ROE and ROCE of 15.1 per cent and 20.5 per cent, respectively. While the dividend yield stands at 1.39 per cent.  

The company has strong revenue visibility with an order book of Rs 23573 crore, as of June 2022, which is expected to be completed within the next 5-6 years. About 99 per cent of these orders are from the Indian Navy.  

About the shareholding pattern, 74.5 per cent of the stake is owned by the promoters, 1.76 per cent by FIIs, 9.16 per cent by DIIs, and the rest 14.58 per cent by non-institutional investors.  

The company has a market capitalisation of Rs 5159 crore and is trading at a PE multiple of 21.9x. The stock has a 52-week high and low of Rs 430 and Rs 199, respectively.