Continuing its robust upward trend for the third consecutive trading session, Cochin Shipyard's shares surged by 12% to reach all time high of ₹904.35 on Thursday.
The stock gained substantial momentum following the company's impressive financial results for the quarter ending in June, which were released on August 11. This positive performance pushed the stock up by 25% in just the following two trading sessions. Overall, in August so far, the stock rallied 32.5%.
Cochin Shipyard is a Miniratna-listed small-cap stock with a market capitalization of ₹11,668 crore. The company is mainly engaged in the construction of vessels and repairs and refits, including the upgradation of ships, periodical lay-up repairs, and life extension of ships.
The company reported a 136% rise in its consolidated net profit to ₹99 crore, compared to ₹42 crore in the corresponding quarter of the previous fiscal. Its consolidated revenue from operations rose nearly 8% during the quarter to ₹476 crore from ₹441 crore in the year-ago period.
The ship repair segment's revenue experienced 68.53% YoY growth, reaching ₹150 crore. On the other hand, the shipbuilding segment's revenue remained flat at ₹325 crore. The company's other income surged by 50% YoY to ₹84 crore.
In a recent exchange filing, the company said that it has been upgraded from ‘Schedule B’ to ‘Schedule A’ CPSE by the Government of India.
"The upgradation to ‘Schedule A’ was notified by the Ministry of Ports, Shipping, and Waterways on July 31, 2023. This upgradation of CSL to ‘Schedule A’ recognises CSL’s strong financial performance, operational efficiency, and contribution to national security," the company said.
The company's shares witnessed a remarkable surge of almost 105% between August 2022 and December 2022. This surge was fueled by the company's achievement of delivering India's first Indigenous Aircraft Carrier (INS Vikrant).
Overall, it ended CY22 with a gain of 50%, while in CY23 so far, the shares have delivered a stellar gain of nearly 69% on robust order wins. In June, the company's subsidiary, Udupi Cochin Shipyard Limited (UCSL), bagged an international order from Wilson Shipowning AS, Norway, for the design and construction of six new generation diesel-electric 3800 DWT general cargo vessel.
During the same month, the company was declared as the lowest bidder by the Indian Navy for the mid-life upgrade of an Indian Naval Ship. The estimated value of the contract is approximately Rs. 300 crore.
Earlier in March, the company secured an order from the Netherlands-based Samskip Group to design and construct two zero-emission feeder container vessels, with the possibility of adding two more vessels. The total project cost for this order is approximately Rs. 550 crore.
03 analysts polled by MintGenie on average have a 'buy' call on the stock.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of MintGenie.