COCHINSHIP - Cochin Shipyard

📊 NSE: COCHINSHIP 🏢 Miscellaneous 📅 Last Updated: 12/13/2025 21:08

💰 Financial Performance

Revenue Growth by Segment

Consolidated revenue for H1 FY26 grew 12.8% YoY to INR 2,368.81 Cr. Ship Repair revenue surged 87.4% YoY to INR 989.23 Cr, while Shipbuilding revenue declined 13.6% YoY to INR 1,197.96 Cr.

Geographic Revenue Split

The company maintains a balance between domestic defense, domestic commercial, and export orders, though specific regional percentage splits were not disclosed in the provided documents.

Profitability Margins

Consolidated Net Profit Margin for H1 FY26 was 12.47% (INR 295.50 Cr PAT on INR 2,368.81 Cr revenue). Standalone Operating Margin for H1 FY26 was 20%, down from 27% in H1 FY25.

EBITDA Margin

EBITDA margin for Q1 FY26 stood at 28%, reflecting strong core profitability. However, the PBILDT margin for FY25 moderated to 19.03% from 23.70% in FY24 following the completion of the IAC construction order.

Capital Expenditure

The company capitalized two major projects in 2025: the International Ship Repair Facility (ISRF) at INR 852.16 Cr and the New Dry Dock at INR 1,342.10 Cr, totaling INR 2,194.26 Cr in new infrastructure.

Credit Rating & Borrowing

CARE Ratings reaffirmed 'CARE AAA; Stable' for long-term facilities and 'CARE A1+' for short-term facilities. Finance costs increased 81.5% YoY in H1 FY26 to INR 27.83 Cr due to increased short-term borrowings.

⚙️ Operational Drivers

Raw Materials

Primary raw materials include steel, marine engines, and specialized ship components. Cost of materials consumed in H1 FY26 (Standalone) was INR 751.22 Cr, representing 39% of standalone revenue.

Capacity Expansion

The New Dry Dock and International Ship Repair Facility (ISRF) are now fully operational, significantly expanding capacity for large-vessel shipbuilding and high-margin ship repair services.

Raw Material Costs

Cost of materials consumed in H1 FY26 was INR 751.22 Cr, a 13.3% decrease from INR 866.29 Cr in H1 FY25, despite revenue growth, indicating a shift in project mix or procurement efficiency.

Manufacturing Efficiency

Consolidated inventory turnover ratio for H1 FY26 was 1.08x, compared to 1.39x in H1 FY25, reflecting a higher inventory base of INR 1,929.52 Cr as projects scale up.

📈 Strategic Growth

Expected Growth Rate

14-15%

Growth Strategy

Growth will be driven by operationalizing the New Dry Dock and ISRF to handle larger vessels and higher repair volumes. The company aims to double its turnover in 5 years by balancing defense (domestic), commercial, and export orders while leveraging its strategic importance to the Indian Navy.

Products & Services

Shipbuilding (Defense and Commercial vessels, including Aircraft Carriers) and Ship Repair services (International and Domestic).

Brand Portfolio

Cochin Shipyard Limited, Udupi Cochin Shipyard Limited (UCSL), Hooghly Cochin Shipyard Limited (HCSL).

New Products/Services

Expansion into higher-margin international commercial projects and leveraging the new ISRF for specialized ship repair services.

Market Expansion

Targeting international export markets for commercial vessels and expanding domestic ship repair footprint through ISRF.

Market Share & Ranking

Cochin Shipyard is a leading player in the Indian shipbuilding industry and the only shipyard capable of building aircraft carriers for the Indian Navy.

Strategic Alliances

Wholly owned subsidiaries include Udupi Cochin Shipyard Limited and Hooghly Cochin Shipyard Limited.

🌍 External Factors

Industry Trends

The industry is evolving under the 'Maritime India Vision 2030' and 'Maritime Amrit Kaal Vision 2047,' focusing on increasing India's global share in shipbuilding and repair to 5% and 25% respectively.

Competitive Landscape

Key competitors include other PSU shipyards (Mazagon Dock, Garden Reach) and private players, though CSL's capacity for large vessels remains a distinct advantage.

Competitive Moat

The moat is sustained by GoI ownership (67.91%), specialized infrastructure (New Dry Dock/ISRF), and a unique track record in complex defense projects like the Indigenous Aircraft Carrier (IAC).

Macro Economic Sensitivity

Highly sensitive to India's defense budget allocations and global shipping trade volumes which drive ship repair demand.

Consumer Behavior

Shift toward recurring revenue models in ship repair as ship owners seek faster turnaround times provided by the new ISRF.

Geopolitical Risks

Beneficiary of India's 'Atmanirbhar Bharat' push for indigenous defense production, which prioritizes domestic shipyards over global competitors.

⚖️ Regulatory & Governance

Industry Regulations

Subject to Ministry of Ports, Shipping and Waterways directives and SEBI LODR regulations. The company is currently non-compliant with board composition requirements regarding independent directors.

Taxation Policy Impact

Standalone current tax for H1 FY26 was INR 76.74 Cr on a PBT of INR 388.48 Cr, representing an effective tax rate of approximately 19.7%.

Legal Contingencies

The company faces potential liquidated damages for delayed delivery of 2 ships to a Government customer and has incurred fines from BSE/NSE for board composition non-compliance.

⚠️ Risk Analysis

Key Uncertainties

Uncertainty regarding the waiver of liquidated damages for delayed projects and the timing of independent director appointments by the Government of India.