Shipping stocks have recently drawn attention, especially after the government announced Rs. 70,000 crore in maritime schemes to bolster India’s maritime capabilities. Against this backdrop, Cochin Shipyard Ltd (CSL), a leading Miniratna PSU, stands out as a specialist in shipbuilding and repair for both commercial and defence sectors.
CSL constructs a variety of vessels, from cargo ships and offshore support vessels to advanced warships, including aircraft carriers. The company’s market capitalization on Monday was Rs. 49,110.60 crore, with shares rising 1.07% to Rs. 1,893.70.
Company Overview
Incorporated in 1972 as a fully government-owned company, CSL has emerged as a leader in India’s shipbuilding and repair industry over the past three decades. Its services include shipbuilding, ship repair, and marine engineering training, emphasizing self-reliance and strategic defence manufacturing. The shipyard can build vessels up to 1,10,000 DWT and repair ships up to 1,25,000 DWT, including India’s largest double-hull Aframax tankers.
CSL has secured orders from clients in Europe and the Middle East and has been selected to build India’s first indigenous Air Defence Ship. Its repair operations, started in 1982, include life extension and upgrades for Navy, Coast Guard, Port Trusts, and commercial clients like SCI and ONGC. The company also trains 100 graduate engineers annually for service on domestic and international vessels.
Revenue Performance
In Q1 FY26, shipbuilding revenue fell 25% to Rs. 347.80 crore from Rs. 465.07 crore in the same quarter last year, signaling a slowdown. Conversely, ship repair revenue surged 157% to Rs. 629.62 crore from Rs. 244.78 crore, highlighting strong demand in this segment.
Order Book and Pipeline
CSL’s current order book is approximately Rs. 21,100 crore, with 65% from Defence, 28% from Commercial (Domestic and Export), and 7% from ship repair. Defence orders include 14 vessels worth Rs. 13,700 crore. The commercial segment comprises 34 domestic vessels (Rs. 1,700 crore) and 27 export vessels (Rs. 4,200 crore), while ship repair orders account for Rs. 1,500 crore.
The shipbuilding order pipeline totals Rs. 2,85,000 crore, 13.5 times the current order book. Defence projects dominate with 77% (Rs. 2,20,000 crore), and Commercial accounts for 23% (Rs. 65,000 crore). Within Defence, 59% of orders are at the RFI stage, 37% at expected RFI, 4% at bid submitted, and a small portion at the RFP stage. The Commercial pipeline is split between Domestic (62%) and International (38%).
Financials
In Q1 FY26, CSL’s revenue rose 37.7% from Rs. 710 crore to Rs. 977 crore, while net profit increased from Rs. 181 crore to Rs. 188 crore. The company maintains a strong ROCE of 20.4% and ROE of 15.8%, with a low debt-to-equity ratio of 0.09. Dividend yield stands at 0.52%, with a consistent payout ratio of 42.9%.
Key Takeaway
Cochin Shipyard’s growth is primarily driven by Defence orders. While Commercial shipbuilding contributes a smaller share, Defence remains the core revenue engine, with both current and future orders heavily skewed toward national security projects
