President of India Sold 1,94,77,966 Shares: Debt-Free Defence Shipbuilding Company With Rs 34,787 Crore Order Book
The stock gave multibagger returns of over 140 per cent from its 52-week low of Rs 1,046 per share and a whopping 1,800 per cent in 3 years.
The President of India, acting through the Ministry of Defence, has announced its intention to sell up to 1,14,10,366 equity shares (representing 2.83 per cent of the paid-up capital) of Mazagon Dock Shipbuilders Limited through an Offer for Sale (OFS) via the stock exchange mechanism. Additionally, the Promoter may exercise an Oversubscription Option to sell up to 80,67,600 equity shares (2 per cent) more, aggregating to 4.83 per cent of the total paid-up equity capital of the Company. The OFS will be carried out under the SEBI and Stock Exchange Guidelines, with trading scheduled for non-retail investors on April 4, 2025 (T Day), and for retail investors, employees, and carried-forward non-retail bids on April 7, 2025 (T+1 Day). The floor price for the offer has been set at Rs 2,525 per equity share.
As per the guidelines, a minimum of 25 per cent of the Offer Shares will be reserved for mutual funds and insurance companies, and 10 per cent for retail investors, subject to valid bids. Eligible employees of Mazagon Dock Shipbuilders Limited will also have the opportunity to apply for up to 50,000 shares at the cut-off price. Bids will be allocated on a price-priority basis above the floor price, with the cut-off price mechanism applicable for retail and employee categories. In the event of oversubscription, allocations will be made proportionately, and unallotted non-retail bids may be carried forward to the next day. Settlement timelines vary by investor category, with final settlements scheduled between T+1 and T+2 trading days.
This Offer, structured and not a public offering under the Companies Act, is limited to Qualified Institutional Buyers, excluding US and restricted jurisdictions (except via exemptions). Participants must consult advisors and review the Notice/OFS Guidelines. It aims to meet SEBI's minimum public shareholding requirements and is managed solely by IDBI Capital Markets & Securities Limited.
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About the Company
Mazagon Dock Shipbuilders Limited (MDL), a renowned Indian shipyard established in 1774, has a rich history of building a wide range of vessels, including warships, submarines, cargo/passenger ships, and offshore platforms. Having constructed over 800 vessels since 1960, MDL has consistently demonstrated its shipbuilding prowess. In recognition of its significant contributions to India's Defence industry, MDL was conferred the prestigious 'Navratna' status in June 2024, joining the ranks of India's top-performing public sector enterprises. This elevation is a testament to MDL's strong financial performance, consistent track record, and commitment to strengthening India's defence capabilities.
According to its Quarterly Results, the net sales increased by 33 per cent to Rs 3,143.62 crore and net profit increased by 30 per cent to Rs 768.22 crore in Q3FY25 compared to Q3FY24. Looking at its nine-month results, the net sales increased by 30 per cent to Rs 8,257.47 crore and net profit increased by 68 per cent to Rs 1,986.92 crore in 9MFY25 compared to 9MFY24 In its annual results, the net sales increased by 24 per cent to Rs 10,568.05 crore and net profit increased by 73 per cent to Rs 1,936.97 crore in FY24 compared to FY23. As of December 31, 2024, the company is debt-free.
The shares of the company ex-traded stock split in the ratio of 1:2, i.e., the existing 1 equity share of the face value of Rs 10 each fully paid up shall be subdivided/ stock split into 2 equity shares of the face value of Rs 5 each fully paid up. The record date for the stock split was Friday, December 27, 2024.
As of December 31, 2024, the company’s order book stands at Rs 34,787 crore and as of December 2024, FIIs & DIIs have increased their stakes to 1.55 per cent & 1.46 per cent, respectively compared to September 2024. The company has a market cap of over Rs 1,00,000 crore. The stock gave multibagger returns of over 140 per cent from its 52-week low of Rs 1,046 per share and a whopping 1,800 per cent in 3 years. Investors should keep an eye on this stock.
Disclaimer: The article is for informational purposes only and not investment advice.