On Monday, the share price of Garden Reach Shipbuilders surged by almost 6% on the receipt of a Letter of Intent for a significant contract for ₹491 crore from the Ministry of Defence. A letter of intent for the award of a contract for the design, development, construction, integration of equipment, testing, certification, commissioning, and supply of One Acoustic Research Ship (ARS) to the company has been sent by the Naval Physical and Oceanographic Laboratory, GoI, Ministry of Defence, DRDO, Kochi. The share price of Garden Reach Shipbuilders began the day on the BSE at ₹1,800 a share, and it reached a high of ₹1,870 during the day.
“Garden Reach Shipbuilders share price has recently formed a support base around ₹1,500. The downside seems to be limited from here and hence positional traders can look for buying opportunity on some dips with a stop loss below ₹1,500,” said Ruchit Jain, Lead Research Analyst at 5paisa.
The contract will go into effect 36 months after it is signed, the company said in an exchange filing.
The company was notified at the beginning of this month that it had been awarded a contract to design, build, operate, and maintain Hybrid Electric Ferries as part of the West Bengal Transport Infrastructure Development Corporation Ltd Project, which is overseen by the West Bengal government’s Transport Department.
Garden Reach Shipbuilders & Engineers Ltd reported a 13% increase in net profit, or ₹87 crore, for the first quarter that concluded in June 2024. The substantial 34% increase in operating income, which came to ₹1,010 crore from ₹756 crore in the same period the previous year, drove the increase in profit.
The chairman and managing director of Garden Reach Shipbuilders, Cmde Hari PR, highlighted the company’s impressive financial results in Q1 FY25 to demonstrate his confidence in the company’s growth prospects. He stressed that the company, supported by a strong order book and efficient project execution strategies, is well-positioned to maintain its growth momentum.
