The market capitalisation of Mazagon Dock Shipbuilders Ltd. crossed the Rs 1-lakh-crore mark on Thursday and its shares surged nearly 10% to an all-time high.
This surge follows the granting of 'Navratna' status to the company. The Department of Public Enterprises has approved the proposal in a letter dated June 25.
The market cap increased by Rs 13,802.7 crore to Rs 1.08 lakh crore as of 1:35 p.m.
The Union government grants Navratna status to public sector undertakings that hold Miniratna Category I status and consistently receive outstanding ratings. The Navratna status allows a company to invest up to Rs 1,000 crore or 15% of its net worth in a single project. It also has the liberty to engage in joint ventures, form alliances and establish overseas subsidiaries.
Mazagon's stock jumped as much as 9.94% during the day to Rs 5,150 apiece on the NSE. It was trading 9.62% higher at Rs 5,135 per share, compared to a 0.24% advance in the benchmark Nifty at 1:25 pm.
The share price has risen 300% in the last 12 months and 125% on a year-to-date basis. The total traded volume so far in the day stood at 2.9 times its 30-day average. The relative strength index was at 79, implying that the stock maybe overbought.
Three out of the four analysts tracking Mazagon have a 'buy' rating on the stock and one suggests 'sell', according to Bloomberg data. The average of 12-month analyst price targets implies a potential downside of 82%.
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