Jobaaj Stories
In a major boost to the Indian defence sector, the order books of listed defence shipyards are set to see a massive expansion over the next two years, with orders potentially swelling by over three times. This comes as the Indian government is poised to place defence orders worth approximately Rs 54,000 crore, with significant long-term implications for stocks like Mazagon Dock Shipbuilders Ltd, Garden Reach Shipbuilders & Engineers Ltd (GRSE), and Cochin Shipyard Ltd. The positive momentum follows a market correction from July 2024 to March 2025 but sees a notable rebound since April, largely driven by the recent escalation in the India-Pakistan border tensions.
Antique Stock Broking's latest analysis remains bullish on Mazagon Dock and GRSE, maintaining their 'Buy' ratings on both. However, the outlook on Cochin Shipyard has been adjusted to a 'Hold' rating due to uncertainties surrounding its potential aircraft carrier order.
According to Antique Stock Broking, the procurement pipeline for defence warships looks strong, despite facing multi-year delays. The firm highlighted the confidence and visibility on major defence contracts, with estimates suggesting around Rs 2,12,000 crore worth of orders expected between FY26-27. Furthermore, total orders for this period could amount to Rs 2,35,400 crore, more than three times the combined order book of the three listed defence shipyards.
Key projects on the horizon include:
-
Kalvari-Class Submarines: A repeat order for three more submarines with Mazagon Dock, potentially valued at Rs 36,000 crore.
-
P75I Submarines: A competitive bidding process for six conventional submarines with Air Independent Propulsion (AIP) capabilities, potentially worth Rs 70,000 crore.
-
Next-Generation Corvettes: The planned construction of eight advanced corvettes for the Indian Navy, with an estimated value of Rs 36,000 crore.
-
P-17B Frigates: A more advanced version of the P-17A class, valued at approximately Rs 70,000 crore.
With the Government of India’s increased focus on indigenization and strong policy backing for the defence sector, these orders are expected to significantly boost the financial performance of the shipyards.
Antique Stock Broking has set a target price of Rs 3,433 for Mazagon Dock, Rs 1,481 for Cochin Shipyard, and Rs 2,024 for GRSE, reflecting a positive outlook for the Indian defence shipyard sector.
Disclaimer: This article provides stock market news for informational purposes only and should not be interpreted as investment advice. Readers are strongly encouraged to consult with a qualified financial advisor before making any investment decisions.
