Cochin Shipyard, a multi-bagger debt-free PSU company, witnessed strong buying on December 27, so much so that the stock locked at its 5% upper circuit. The reason is that Cochin has secured the largest ASTDS tug order from the Adani Group. Cochin stock is an attractive bet. Brokerage Antique Stock Broking has selected Cochin as its top defence stocks pick, with a target price of Rs 1,627.

Cochin Shipyard Share Price:

After market hours of December 27, Cochin shares were locked at its 5% upper circuit of Rs 1532.10 apiece on BSE, with a market cap of Rs 40,306.61 crore. Cochin is a multi-bagger with gains of 125% on BSE in the current year so far.

Some of the key positive fundamentals of Cochin as per Trendlyne are: Stock Price rose 126.49% and outperformed its sector by 89.39% in the past year; Debt to Equity Ratio is zero as the company is debt-free; Return on Equity(ROE) for the last financial year was 15.65%, in the normal range of 10% to 20%; Mutual Fund Holding increased by 0.43% in the last quarter to 2.63%; Promoter Share Holding stayed the same in the most recent quarter at 72.86%; and Promoter Pledges are zero.

Cochin Shipyard Adani Order:

As per the regulatory filing, Adani Ports & SEZ, through its subsidiary, Ocean Sparkle Limited, has placed an order for 8 nos of 70 T Bollard Pull ASD (Azimuthing Stern Drive) Tugs on Udupi Cochin Shipyard Limited, the wholly owned subsidiary of Cochin Shipyard Limited (CSL) – the leading shipyard in India.

This is in addition to the 3 nos of the 70 T Bollard Pull Tugs already under construction at Udupi-CSL for Ocean Sparkle Limited, totalling 11 Tug orders on Udupi-CSL.

Madhu Nair, the Chairman and Managing Director of CSL said on December 27, “CSL and Udupi-CSL have introduced the Robert Allan Tugs in India complying with the Approved Standard Tug Design and Specifications (ASTDS) and has benchmarked the delivery timelines and quality of the tugs being constructed in India. CSL is committed to transforming the industry by introducing the Battery Electric Tugs too through the upcoming Green Tug Transition Programme (GTTP) announced by the Govt. of India.”

Notably, the tugs are built to the Approved Standard Tug Design and Specifications (ASTDS) promulgated by the Government of India, for promoting Atma Nirbhar Bharath initiatives. Udupi-CSL has been piloting the initial projects under this scheme. Udupi-CSL has already delivered 2 x 62 T Bollard Pull Tugs for Ocean Sparkle Limited in 2023 and 2 x 70 T Bollard Pull Tugs for Polestar Maritime Limited in 2024.

Udupi-CSL since take over in 2020, was revived by Cochin Shipyard Limited, and the Yard has been turned around in a short period, and the orderbook of this Yard has now crossed Rs 2000 Crores.

BUY Cochin Shipyard Stock:

Antique Research has believed in India’s defence story since middle of 2021, and it has played well, creating significant wealth for shareholders. That being said, among its top defence stocks to buy is also Cochin Shipyard with target price of Rs 1,627.

Cochin Shipyard is one of the leading shipbuilding & repair yards in India, which has an infrastructure that combines economy, scale, and flexibility, and has ISO 9001 accreditation. CSL also has an exclusive area set for offshore construction and future expansion. As one of India’s top 10 public sector undertakings, CSL has been rated excellent by the Government of India, four times in a row for achieving the targets set for the yard under the MOU system.

In the year 2024, Cochin rewarded investors with stock split and dividends.

Dividends: The company paid three dividends in 2024 so far. For FY24, the company delivered interim and final dividends of Rs 3.50 per share and Rs 2.25 per share and its ex-date were in February and September month. While for FY25, the company delivered dividend of Rs 4 per share and its ex-date was on November 19.

Stock Split: The company split for the first time in the ratio of 1:2 in January 2024. The face value of Rs 10 each is trimmed to Rs 5 each.