Cochin Ship­yard Ltd: Promis­ing ship-builder!

Money Times - - Stock Buzz -

(BSE Code: 540678) (CMP: Rs.388.90) (FV: Rs.10)

In­cor­po­rated in 1972, Cochin Ship­yard Ltd (CSL) is the largest pub­lic sec­tor ship­yard in In­dia in terms of dock ca­pac­ity. It con­ferred the ‘Mini Ratna’ sta­tus in 2008. It op­er­ates through two busi­ness seg­ments: ship­build­ing and ship re­pair. In both seg­ments, it caters to clients from the de­fence as well as com­mer­cial ship­build­ing sec­tors. In ad­di­tion, it also of­fers ma­rine en­gi­neer­ing train­ing.

CSL’s ship­yard is strate­gi­cally lo­cated along the west coast of In­dia, mid­way on the main sea route con­nect­ing Europe, West Asia and the Pa­cific Rim, which is a busy in­ter­na­tional mar­itime route. It is also close to the Kochi port as well as off­shore oil fields on the western coast of In­dia, rel­a­tively close to the Mid­dle East. It has two docks – ship re­pair dock and ship­build­ing dock. Dry docks are used for the con­struc­tion, main­te­nance and re­pair of ships, boats and other wa­ter­craft. Its ship re­pair dock is one of the largest in In­dia and en­ables it to ac­com­mo­date ves­sels with a max­i­mum ca­pac­ity of 1,25,000 DWT. Its ship­build­ing dock can ac­com­mo­date ves­sels with a max­i­mum ca­pac­ity of 1,10,000 DWT. CSL has worked with sev­eral lead­ing tech­nol­ogy firms like Rolls Royce Ma­rine (Nor­way) and Gaz­trans­port & Tech­nigaz (GTT) SA. Its key ship­build­ing clients in­clude the In­dian Navy, the In­dian Coast Guard and SCI. Its key ship re­pair clients

in­clude the In­dian Navy, the In­dian Coast Guard, SCI, ONGC and DCI. Its docks ran at full ca­pac­ity in FY17 due to which it had to turn down new re­quests.

CSL with 75% pro­moter stake, more than Rs.1600 crore of free cash on the bal­ance sheet, mar­ket lead­er­ship with ~39% mar­ket share, grow­ing or­der book, debt-free sta­tus, best-in-class work­ing cap­i­tal cy­cle, re­li­a­bil­ity in ex­e­cu­tion and be­ing a nat­u­ral ben­e­fi­ciary of large and crit­i­cal gov­ern­ment projects is in a sweet spot. Buy this stock on every de­cline for dou­ble-digit re­turns.

Newspapers in English

Newspapers from India

© PressReader. All rights reserved.