Shares of Mazagon Dock Shipbuilders were surging on Monday after the company inked a major contract with a European customer.

What Happened: The shipbuilding and offshore fabrication yard said it has signed a letter of intent with a European client, outlining plans for the construction of multipurpose hybrid power vessels.

Under the deal, Mazagon Dock will undertake the construction of six firm units and has the option for four additional units of 7,500 deadweight tonnage multipurpose hybrid power vessels. The final pricing for these vessels will be determined at the time of signing the official contract, the company said in an exchange filing.

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Background: Mazagon Dock Shipbuilders Ltd specializes in shipbuilding, ship repairs, and fabrication of offshore structures. The company offers a wide range of products, including warships, merchant ships, submarines, support vessels, offshore platforms, passenger cum cargo vessels, trawlers, main and helidecks, and barges.

Mazagon Dock reported a 40% year-on-year increase in its consolidated net profit, rising to ₹314 crore in the June quarter from ₹224.8 crore last year. However, the company’s revenue from operations witnessed a slight decline, falling 2.6% year-on-year to ₹2172.8 crore in the first quarter compared with ₹2230 crore last year.

In September, Mazagon Dock Shipbuilders revised its revenue growth guidance for the financial year 2024, targeting a revenue growth of 12-15%, up from the previous guidance of 10-12% for the year.

Price Action: Mazdock’s share price was up 5.19% at ₹2,181.05 at the start of trade on Tuesday.

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