A leading shipbuilding and defence solutions provider, renowned for advanced maritime vessels, secures a landmark Rs. 25,000 crore contract from the Indian Ministry of Defence to construct five next-generation warships, bolstering naval capabilities. However, the firm faces a setback as Bangladesh cancels a smaller Rs. 180 crore tugboat order, highlighting mixed developments in its global defence partnerships.
Garden Reach Shipbuilders & Engineers Limited’s stock, with a market capitalisation of Rs. 29,957 crores, rose to Rs. 2,643, hitting a high of up to 5.7 percent from its previous closing price of Rs. 2,500.50. Furthermore, the stock over the past year has given a return of 119.4 percent.
Order Updates
- GRSE emerged as the lowest bidder (L1) in the Ministry of Defence’s bid opening for the construction of Next Generation Corvettes (NGC) for the Indian Navy. GRSE is set to receive an order for five NGC ships, valued at over Rs. 25,000 crores, following the meeting on 21 May 2025.
- The cancelled order was worth Rs 180 crore and was from the Directorate General Defence Purchase, Ministry of Defence, Bangladesh. The construction and delivery of one advanced ocean-going tug was to be designed, built and delivered in 24 months
Also read: Water management stock jumps 11% after announcing strong Q4 results and 200% dividend
Financial Highlights
In Q4FY25, the company reported revenue of Rs. 1,642 crore, marking a robust YoY growth of 61.6 percent from Rs. 1,016 crore in Q4FY24 and a QoQ growth of 29.2 percent from Rs. 1,271 crore in Q3FY25. This strong topline performance reflects continued business momentum, supported by a 3-year revenue CAGR of 42 percent.
Net profit for Q4FY25 stood at Rs. 244 crore, up 117.9 percent YoY from Rs. 112 crore and 149 percent QoQ from Rs. 98 crore, indicating strong operational leverage and margin expansion. The company’s 3-year profit CAGR stands at 43 percent, while its ROE CAGR over the same period is 23 percent, showing efficient capital allocation and consistent earnings growth.
Industry Outlook
During its recent earnings call, the company announced plans to expand its shipbuilding capacity from 24 to 28 ships by the end of 2025. This move reflects growing demand and confidence in the defence sector.
Defence stocks have been rising since Operation Sindoor. Following the operation, Prime Minister Narendra Modi emphasised the need to boost production of defence equipment under the “Made in India” initiative, strengthening local manufacturing.
On the other hand, India-Bangladesh relations have weakened since the removal of former Prime Minister Sheikh Hasina in August last year. The new interim government led by Muhammad Yunus has grown closer to China, signing $2.1 billion worth of deals.
In response to recent trade restrictions from Bangladesh, such as curbs on Indian yarn and rice, India has imposed import limits on Bangladeshi goods worth $770 million (Rs 6,600 crore). These developments signal rising geopolitical tensions and a shift away from previous levels of cooperation.
Written By Fazal Ul Vahab C H
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Dailyraven Technologies or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
