Shares of this midcap company surged around 9 percent in Monday’s trading session after receiving an order worth 54 million USD from a German firm for multi-purpose vessels. In just six months, the shares have delivered a multibagger return of 102 percent to its shareholders.
With a market capitalization of Rs. 20,138 crores, the shares of Garden Reach Shipbuilders & Engineers Ltd started Monday’s trading session on a higher note at Rs. 1,724.10 compared to its previous close of Rs. 1,644.25. During the trading session, the shares hit a high of Rs. 1,819.30, gaining around 9 percent and are currently trading at Rs. 1,768 apiece.
Such a bullish movement in the share price was observed after the company in an exchange filing announced that it had signed an agreement with Carsten Rehder Schiffsmakler and Reederei GmbH & Co., KG Germany for the construction and delivery of four multi-purpose vessels worth 54 million USD (Rs. 451.23 crore) and the order is expected to be executed within 33 months.
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The vessels will be 120 metres long and 17 metres wide with a maximum draft of 6.75 metres. Each of them can carry 7,500 metric tonnes of cargo.
Moreover, the vessels will have a single cargo hold each to accommodate bulk, general and project cargoes. Containers will be carried on hatch covers. The ships have been specifically designed to carry multiple large windmill blades on deck.
The said agreement was formalised in the presence of several key officials of both companies.
Coming onto the company’s financial statements, the revenue increased by 10 percent from Rs. 923 crores during the December quarter to Rs. 1,016 crores in the March quarter. In addition, the net profits zoomed by 27 percent from Rs. 88 crores to Rs. 112 crores during the same timeframe.
As of March 2024, the total value of the order book is Rs. 22,652.68 crores, primarily driven by orders from the Shipbuilding sector amounting to Rs. 22,593 crores.
Key projects within this sector include the P17 Alpha Project valued at Rs. 12,174 crores, the Survey Vessel Large Project at Rs. 940 crores, the Anti-Submarine Shallow Water Craft Project at Rs. 4,886 crores, and the Next Generation Ocean Going Patrol Vessel valued at Rs. 3,359 crores.
Furthermore, the defence company is expecting peak revenue in the next two years and anticipating major revenue contributions from the P17 Alpha Project and Anti-Submarine Shallow Water Craft Project. Additionally, plans to enhance capacity from 20 to 24 ships for concurrent construction.
The company has a strong history in ship exports. It was the first Indian shipyard to export a warship CGS Barracuda to Mauritius, in 2014.
Headquartered in Kolkata, Garden Reach Shipbuilders & Engineers Ltd is a premier shipbuilding company in India under the administrative control of the Ministry of Defence, primarily catering to the shipbuilding requirements of the Indian Navy and the Indian Coast Guard.
Written By Vaibhav Patil
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