Mazagon Dock Shipyard hits 52-week high

Mazagon Dock Shipyard shares soared to a 52-week high on Tuesday, surpassing the previous day's peak with huge volumes. The Mazagon Dock stock gained by as much as Rs 130.3 or nine per cent to Rs 1,574.6 apiece on BSE. At the latest milestone, the stock took its surge to almost six times in the past one year, sharply outperforming a 20 per cent gain in the benchmark Nifty index.

The share price has seen a turnaround in the last one year, rising from Rs 263.45 to its 52-week high of Rs 1574.60 on the BSE as of writing the report, a breathtaking 497.48 per cent rise.

Just on Monday, it jumped 10 per cent, from Rs 1,444.35 on Friday to Rs 1454.10.

On Tuesday, the share has nearly acheived that mark. The share price of the multibagger at close on July 11, 2022 was Rs 263.45.

Mazagon Dock, India's only shipyard building destroyers and conventional submarines for Indian Navy, saw a meteoric rise in its share price in the last one year, which came on the back of some of the biggest orders it got recently. The dock has reportedly got approval by the Defence Procurement Board of a proposal to acquire three submarines.

The share's terrific performance is also because of estimated ($5.2 billion or Rs 43,000 crore) order it got in June, when ThyssenKrupp Marine Systems (TKMS) signed a Memorandum of Understanding with the Mumbai-based shipbuilders company for building conventional, air-independent-propulsion submarines.

The contract will see Mazagon Dock delivering six submarines.

The company in its FY23 Q4 results announced that its order book as on March 31, 2023 was approximately Rs 38,500 crore.

However, after the deal with TKMS, Mazagon Dock's order book was estimated to be around Rs 80,000 crores.

The deal with TKMS, the company's book to bill ratio also increased from 5 to near 10.5.

Mazagon Dock had told in the earnings call that the projects had to be executed in 3 years.

It also said that the peak cash generation of the company would be in FY25.

Accordingly, the company has 10 years of earning visibility.