Cochin Shipyard Ltd. shares jumped over 7% during early trade on Tuesday after the company emerged as the lowest bidder for a Rs 5,000-crore order by the Defence Ministry. The order involves construction of five Next Generation Survey Vessels or NGSV for the Indian Navy, the Miniratna PSU said in an exchange filing after market hours a day ago.
"We would like to inform that at the meeting held today at the Ministry of Defence, New Delhi, Cochin Shipyard Limited (CSL) has been declared as L1 in the tender floated by the Ministry of Defence for construction of 5 nos. of Next Generation Survey Vessels (NGSV) for the Indian Navy. The estimated total order value is around Rs 5,000 crore," the filing stated.
It added that the final announcement of the contract will be depend on the satisfactory completion of "necessary formalities" in this regard, and will be updated in due course.
Cochin Shipyard's stock gained as much as 7.2% to Rs 1,574.5 on the NSE, compared to 0.1% decline in the Nifty 50. The share price has risen 27% in the last 12 months. The total traded volume so far in the day stood at 12 times its 30-day average. The relative strength index was at 52.
Out of the four analysts tracking the company, two have a 'buy' rating on the stock, and two suggest a 'sell', according to Bloomberg data. The average of 12-month analyst price targets is Rs 1,489, which implies a potential downside of 4%.
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