Large Cap Defence Stock Gains After Doubling Q3 Profit

Shares of Cochin Shipyard were gaining on Wednesday after the defence firm more than doubled its net profit in the third quarter.

What Happened: For the third quarter, the shipbuilding company reported an impressive 121.4% year-on-year growth in consolidated net profit, reaching ₹244.4 crore. The revenue from operations also showed a robust performance, rising by 64.6% year-on-year to ₹1,056.4 crore during the quarter.

In addition to the strong financial results, Cochin Shipyard declared a second interim dividend of ₹3.50 per equity share of ₹5 each fully paid-up (70%) for the financial year 2023-24. The record date for the interim dividend is set for Monday, February 12.

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What Brokerages Say: Analysts at ICICI Direct has assigned a “buy” call to the defence stock with a target price of ₹1340 per share. The brokerage firm notes that the order pipeline remains strong in defence and commercial ship-building and ship-repair segments, including exports.

Around ₹13,000 crore worth of ship-building contracts are in the pipeline, with tenders expected to be floated in the medium term. Additionally, ₹84,000 crore worth of orders are in the RFP stage, according to the management.

Price Action: Cochin Shipyard’s share price was up 2.79% at ₹903.15 in early trade on Wednesday.

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