The Offer for Sale (OFS) to sell a 5% stake in Cochin Shipyard Ltd. has been launched by the Narendra Modi administration, with a minimum share price of ₹1,540. The OFS is slated to open for non-retail investors on October 16, 2024, and for retail investors on October 17.
The OFS offers a base offer of 2.5% and a green shoe option that allows users to receive an extra 2.5%. For investors who are not retailers, the sale is scheduled to start on October 16 and for retailers, on October 17.
As of September 30, 72.86 per cent of Cochin Shipyard was owned by the government.
For the quarter that ended June 30, 2024, Cochin Shipyard reported a stunning 76.5 per cent year-over-year growth in net profit, hitting ₹174.2 crores, up from ₹98.7 crores in the same period the previous year. The business’s operating revenue increased significantly by 61.1%, from ₹475.9 crore to ₹771.5 crore during the same period in the preceding fiscal year.
The company’s Earnings Before Interest, Tax, Depreciation, and Amortisation (EBITDA) increased by 125% to ₹177.3 crore, more than doubling at the operational level. During the reporting quarter, the EBITDA margin increased to 23% from 16.5% during the same period in the previous fiscal year.
The Ship Building division of Cochin Shipyard, which witnessed sales rise by 62% from the prior year to 527 crore, was the main driver of the company’s expansion. Sixty-eight per cent of the company’s total revenue comes from this division.
The Ship Repair division of the company, which makes up 32% of overall revenues, had a 63% growth in revenue to ₹245 crore from the previous year, while margins increased to 43% from 24%.
Cochin Shipyard’s shares have dropped 44% since July of this year, when they peaked at ₹2,977, as of Tuesday’s market closing. Still, the stock has increased fourfold from ₹432 at IPO.
