Shares of Cochin Shipyard Ltd. advanced after it bagged a Rs 313.4 crore order from the Ministry of Defence for a ship upgrade.
The defence ministry signed a contract for mid-life upgrades and re-powering of INS Beas with Cochin Shipyard on Monday, according to a government statement.
"INS Beas is the first of Brahmaputra Class Frigate to be re-powered from steam to diesel propulsion. After completion of Mid Life Upgrade and Re- Powering in 2026, INS Beas will join the active fleet of the Indian Navy, with a modernised weapon suite and upgraded combat capability," the statement said.
The upgradation project would also involve more than 50 medium and small enterprises.
The Kochi-based company's contractual shipbuilding orderbook stands at about Rs 22,000 crore, as compared with Rs 21,400 crore at the end of FY23, Chairperson Madhu Nair told BQ Prime last month.
The shipyard has bid for offshore patrol and fast patrol defence vessels. It has some mid- and large-sized orders in the pipeline, he said. The defence pipeline looks robust for the next 12–18 months, according to the chairperson.
Cochin Shipyard has two large naval projects—the anti-submarine warfare shallow-water craft corvette, or ASW SCW—and the next-generation missile vehicles that together contribute to about Rs 16,000 crore of the defence order book, Nair said.
These projects comprise 14 vessels combined—eight belong to the ASW SCW corvette project, and the remaining six are part of the next-generation missile vehicles project.
Shares of Cochin Shipyard rose as much as 3.87% before paring gains to trade 2.19% higher at 2:49 p.m. This compared with a 0.03% advance in the benchmark NSE Nifty 50.
The total traded volume was 0.6 times the 30-day average, while the relative strength index stood at 55.38 as of 3:18 p.m.
Of the four analysts tracking the company, two maintain a 'buy', one suggests a 'hold', and one recommends a 'sell' on the stock. The average of 12-month target price implies a potential return of 0.5%.
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