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By Malvika Gurung
Investing.com — Shares of two leading shipbuilding companies Cochin Shipyard (NS:) and Garden Reach Shipbuilders (NS:) have jumped up to 31% in the week ended August 18, 2023, significantly defying the overall market mood.
The domestic equity benchmark indices and declined for the fourth week in a row last week, dropping 0.61% and 0.57% respectively.
In comparison, shares of the small-cap shipbuilders Cochin Shipyard and Garden Reach Shipbuilders shot up 30.6% and 28.5% respectively, in the holiday-shortened week. Both the stocks hit fresh 52-week highs last week on August 18 and August 17, respectively.
One of the major triggers for a rally in the shares of shipbuilding stocks was the government clearing projects worth Rs 19,000 crore for shipping companies, which would involve the manufacture of five fleet support ships, along with the delivery of one fleet support ship in a period of four years.
Further, the two shipbuilding stocks also shot up following stellar earnings for the quarter ended June 30, 2023.
Cochin Shipyard reported a massive 135% year-on-year (YoY) rise in its consolidated net profit at Rs 98.65 crore in the June quarter, along with a 7.9% YoY growth in revenue from operations to Rs 475.9 crore during the period.
Garden Reach Shipbuilders posted a strong 53% YoY jump in net profit at Rs 76.68 crore in the first quarter of the financial year 2023-24, along with a healthy 30% rise in revenues at Rs 755.9 crore in Q1 FY24.
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