Cochin Shipyard surges 20%, hits record high on strong order book

Shares of ship builder Cochin Shipyard surged as much as 20 per cent in intraday deals to hit record high of Rs 1,146 on the BSE after the company in its annual report highlighted about the strong order book going ahead.

The company's total order book more than doubled to Rs 16,936.69 crore at the end of financial year March 2023 compared with order book of Rs 7,540 crore during the same period last financial year.

"With a strong order book, ensuing pipeline of major defence projects, enhanced interest coming in from European segment, our emerging innovative initiatives in the maritime space, various Memorandum of Understandings for ship repair, we are optimistic about our near term and long term future. Our subsidiaries are also coming on their own with confidence," Cochin Shipyard said in its annual report. 

During the year 2022-23, Cochin Shipyard was successful in securing against intense competition, major shipbuilding orders namely two Commissioning Service Operation Vessels (CSOV) from Pelagic Group, Cyprus, six units of Next Generation Missile Vessels (NGMV) from Ministry of Defence and two units of Zero Emission Feeder Container Vessels, being one each from NAVSHUTTLE 1 AS and NAVSHUTTLE 2 AS, Lysaker, Norway, Companies in the SAMSKIP Group, headquartered in Netherlands. 

The container ships order book hit a 10 year high last year with most orders booked by Korean and Chinese yards. Total order book accounts for 30 ships with Gross Registered Tonnage (GRT) less than 0.5 million, Cochin Shipyard said. 

Cochin Shipyard however said that because of lack of financing mechanism in shipbuilding space India is not considered as a contender in the main merchant fleet ships.

"The healthy order book positions in the international market resulted in build-up of enquiries to Indian yards. But with the diminished capacity due to collapse of many private shipyards and with no shipbuilding financing mechanism in place, India still is not considered as a serious contender in the main merchant fleet ships. However, on the smaller short sea market, the country could make some inroads with some overseas contracts bagged by Indian yards," Cochin Shipyards said.

Defence Shipbuilding

The shipbuilding industry is dependent on the defence requirements and the company concluded the largest ship building contract for the construction of six units of Next Generation Missile Vessels (NGMV) for the Indian Navy thus adding good order book value to the company, the company added.

As of 11:51 am, Cochin Shipyard shares traded 19 per cent higher at Rs 1,132.45, outperforming the Sensex which was down 0.06 per cent.