Today, we recommend two stocks, one from the shipbuilding sector and another from the chemical sector, recommended by the Trade Brains Portal, to buy for an upside potential of more than 29%. The chemical industry is a vital sector in India, contributing significantly to the nation’s GDP, manufacturing output, and exports. While the shipbuilding sector is crucial for India’s economic and strategic growth, it contributes to national security, economic development, and global trade. We also analyzed the market’s performance on Tuesday to understand what may lie ahead for the stock indices in the coming days.
1. Cochin Shipyard Ltd
- Current price: ₹ 1,925
- Target price: ₹ 2,490
- Upside: 29.35%
- Time frame: 16-24 Months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
Cochin Shipyard Ltd is one of the top shipbuilding and repair yards in India, which was established in 1972 and holds a Miniratna-I status. In order to supply the Ministry of Shipping with shipbuilding and ship repair capabilities, the company has a technical partnership with Mitsubishi Heavy Industries. CSL has collaborated with major players in the sector, such as Vard Group (Norway), GTT (France), and Rolls-Royce Marine (Norway). In FY25, shipbuilding accounts accounted for 61% of their total income, with ship repair accounts accounting for the remaining 39%. Its infrastructure blends economy, scale, and flexibility.
In FY25, the company reported revenue from operations of Rs 4,820 crore, a 26% increase from FY24. The shipbuilding segment contributed Rs 2,955 crore of revenue, a growth of 5% from FY24, and the ship repair segment saw an 85% rise in revenue to Rs 1,864.57 crore in FY25. Their operating margins stood at 24% to Rs 1,164 crore, and inventory turnover declined to 3.31 in FY25 compared to 5.48 in FY24. In FY25, profit after tax stood at Rs 827.33 crore, a 6% increase, compared to Rs 783.27 crore in FY24.
The company signed many significant deals in Q1 of FY26. CSL and Drydocks World, a DP World firm, have inked a Memorandum of Understanding to strengthen India’s offshore fabrication and ship repair capacities. Furthermore, CSL and HD Korea Shipbuilding & Offshore Engineering Co. Ltd. (KSOE), South Korea, formed a significant partnership that strengthened India’s shipbuilding ecosystem through international cooperation and knowledge sharing, boosting independence and competitiveness in the maritime industry.
The company received an order for two 70 T bollard pull tugs, valued at about Rs 100 crore and Rs 250 crore, respectively, from Polestar Maritime Ltd. in Q1 FY26. It is anticipated that the tugs would arrive in May and September of 2027. Additionally, Hooghly Cochin Shipyard Limited (Hooghly CSL), a fully owned subsidiary of CSL, has received a sizable order from Heritage River Journeys Private Limited, operating as Antara River Cruises, for the construction of two luxurious river cruise ships, valued at between Rs 100 crore and Rs 250 crore, to be operated on the Brahmaputra River.
Risk Factor
Steel (the grade and quality of which, in each project, depend on the requisite classification criteria) and other materials, equipment, and other components like pumps, propellers, and engines are the main raw materials used by CSL. In fiscal 2025, 52.25% of the company’s expenses were related to material use. The company’s operations, financial situation, and business could be negatively impacted if it is unable to pass these price hikes on to its clients due to its current fixed contracts.
2. Deepak Nitrite Ltd
- Current price: ₹ 1,978
- Target price: ₹ 2,460
- Upside: 24.36%
- Time frame: 12 Months
To view the report for the stock mentioned above or explore other stock recommendations, click here
Why it’s recommended
Deepak Nitrite Ltd. is a well-known producer of chemical intermediates, offering a wide range of goods to various industries such as agrochemical, pharmaceutical, plastics, textile, paper, and home personal care in India and overseas, including goods like phenolics, acetone, dyes & pigments, and IPA. It was founded in 1970. The company sells its products to over 45 countries on six continents through eight manufacturing facilities spread across five key locations and two project sites presently under construction. The company has more than 1,000 customers, 34 products, and 56 applications as of FY25.
With a total revenue of Rs 8,365.79 crore in FY25, up 8% from Rs 7,757.93 crore the year before, the company demonstrated strong performance. With an EBITDA margin of 14.2%, EBITDA stood at Rs 1,176 crore. After investing between Rs 100 and Rs 115 crore, the company has the business plans to have its new R&D unit in Savli, Vadodara, operational by Q2 of FY26, having taken various additional efforts to increase innovation. By the second half of FY26, the business expects to commission the downstream acetone derivatives, MIBK and MIBC. In addition to several other cutting-edge technology platforms, DNL has implemented the SAP S4 HANA ERP system to encourage digitalization across the entire organization.
Looking forward, the company is anticipated to spend between Rs 1,200 and Rs 1,500 crore on cash capital expenditures in FY26. In sectors like polycarbonate and nitric acid, the investments are in line with well-coordinated strategies that incorporate both forward and backward integration. Additionally, its subsidiary Deepak Chem Tech Limited is prepared to invest Rs 14,000 crore over the next three to four years in the production of innovative chemicals for the materials industry, thanks to strong relationships with the Gujarat government.
As DNL explores new product frontiers like chemicals, bisphenol A, polycarbonate, and MMA, it is also creating new platforms for fluorination, cyanation, and other processes. The new solutions will serve customers in the personal care and pharmaceutical industries in addition to high-impact industrial solvents and energy applications. The company intends to commission four projects in Q2 FY26, including the CNA & WNA nitric acid factory. These projects will increase value chain involvement, lower costs, increase sustainability, and enhance upstream integration.
Risk Factor
The Company is working on large capex programs, including new product lines and capacity additions. Due to the size and complexity of these projects, the company is susceptible to execution challenges such as delays, excessive spending, and integration concerns. Furthermore, Deepak Nitrite has been under constant price pressure, particularly in agricultural intermediates, as a result of China’s surplus supply and weak demand. This leads to lower sales realizations and lower profitability. Recent increases in US tariffs on Indian chemical imports, which increased from 3.5% to 27%, have put pressure on the sector.
Market Recap, 15th July
On Tuesday, the Nifty 50 had a gap-up start to the day, opening at 25,089.50, marginally up by 7 points from the closing price of 25,082.30 the day before. The index gained 113.50 points, or 0.45%, from the beginning to the end, peaking at 25,245.20 in the morning and closing at 25,195.80 in the afternoon. The RSI was at 50.50, well below the overbought zone of 70, and the Nifty closed below the 20-day EMA, but above all three of the 50/100/200-day EMAs on the daily chart.
A similar pattern was followed by the BSE Sensex, which opened at 82,233.16 and peaked intraday at 82,743.62. It closed below the 20-day EMA, but above all three of the 50/100/200-day EMAs on the daily chart and concluded the day at 82,570.91, up 317.45 points, or 0.39%, with an RSI of 49.59. All the major indices were in green today.
The Nifty Auto Index was a major gainer, finishing at 23,905.25, up 1.50% or 353.25 points. Stocks like Hero Moto Corp, TVS Motor, Bajaj Auto, and Samvardhana Motherson rose more than 2% on Tuesday. The Nifty Healthcare Index finished the day at 14,787.65, up 179.95 points, or 1.23%, as well. The sector’s highest performers, Biocon and Syngene, increased by 2.99%, while Sun Pharma, Fortis Healthcare, and Apollo Hospitals all had gains of more than 2%. The Nifty Pharma Index was also among the major gainers, closing at 22,665.70, up 1.14%, or 255.35 points. Stocks like Natco Pharma, Biocon, and Sun Pharma rose more than 2% on Tuesday.
Asian markets also showed bullish sentiments. Hong Kong’s Hang Seng finished the day after rising 1.60%, or 386.80 points, to 24,590.12. The Kospi of South Korea closed at 3,215.28, up 0.41% or 13.25 points. The Nikkei 225 in Japan rose 218.40 points, or 0.55%, to close at 39,678.02. On the other hand, Shanghai’s Composite Index closed the day lower at 3,505.00, down -14.65 points, or -0.42%. At 4:55 p.m., Dow Jones Futures were up 17.48 points, or 0.04%, at 44,471.16 in US markets.
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