Mazagon Docks Shipbuilders a ‘Miniratna Comoany’ is one of India’s leading defence public sector undertaking shipyards, operating under the aegis of the Ministry of Defence. It undewrtakes the construction, repair, and refurbishment of warships and submarines at its dedicated facilities in Mumbai and Nhava. Company offers diverse range of products for both domestic and international clienteles which includes Naval Ships, Submarines, Littoral Combat Ships, Naval Auxillary Ships, Supply or Support Vessels, Ferries, Dredgers, Cargo Vessels along with Special products such as Mobile target Simulator, Li-Ion Batteries, Fuel Cell Electric Vessel, Solar Electric hybrid Boat, Air Boat, Midget Submarine, Expendable Underwater Targets and AUV Swarm Drones. Company’s upcoming projects includes Unmanned Vessels, EV charging stations and some offshore projects. Company also provides various services such as Repairs and Refit, Desigining of Ships, Know How Provider, Training, Tug Support, Supply Chain Management and Self Propeller Modular Transporter. Since 1960, the company has delivered 802 vessels including 28 warships from advanced destroyers to missile boats and 7 submarines. It is amongst the very first shipyards in India to manufacture Corvettes of the Veer & Khukri Class. Company has also been executing orders for diesel electric submarine Scorpene Class in collaboration with Naval Group, Feance.The company has already entered into as many as 24 MoUs with various national and international firms aiming at design and development of Drones, Autonomous Underwater Swarm Drones, EPC projects in the field of Infra, Railway, Oil & Gas, water treatment, energy and other innovative projects. They also have a target to commercialize the CO2 absorber, steering console, Fuel Cell etc. which are presently used in Defence Industry only under ‘Atma Nirbhar Bharat’ initiative of GOI. Recently the company’s order stands at Rs. 39,117 cr. as on June Quarter of FY24.

Fundamentals (FY22-23):

Financial Results:

Company’s Net Sales was Rs 1,827.70 crore in September 2023 up 7.36%, Quarterly Net Profit at Rs. 332.88 crore in September 2023 up 55.62% and EBITDA stands at Rs. 428.10 crore in September 2023 up 52.14% as compared to September 2022. Company’s EPS has increased to Rs. 16.50 in September 2023 from Rs. 10.61 in September 2022.

Key Points:

1. Mazagon Dock Shipbuilders Ltd. along with Tata Advanced Systems Ltd & Vijai Marine Services Pvt Ltd as technology partners have conceptualized and developed FCEV MDL the very first hydrogen boat prototype which is a 6 Passenger boat, fitted with a 6 KW Electric OBM, a 10.2 KWH Battery, Fuel Cell System and can run for 22 Hours with compressed Hydrogen filled in PESO approved Cylinders. It uses a green hydrogen fuel cell system having zero toxic emission, very few moving parts with a very low heat and acoustic signature.
2.  Company has also developed Airboat which is a Flat-bottomed watercraft propelled by Aircraft-Type propeller powered by an Aero engine which has ability to maneuver on water surface with minimal draft & marshy land proving its amphibious capabilities. It can be utilized while carrying out rescue operations during floods as well as for boarder patrolling as it is capable of high-speed propulsion.
3. Recently the company has delivered Third Stealth Destroyer of Project 15B Class Guided Missile Destroyer i.e. Yard 12706 (IMPHAL) to the Indian Navy which is amongst the largest Destroyers constructed in India, with an overall length of 164 meters and a displacement of over 7500 Tons.
4. Recently MDL marked its 250 glorious years of existence with excellence and expertise with the launch of the fourth Stealth Frigate of Project 17A ‘MAHENDRAGIRI’ which was built using Integrated Construction methodology which involves hull blocks with parallel outfitting.
5. Recently the company as delivered Second Ship of Project 15B Class Guided Missile Destroyer i.e. Yard 12705 (Mormugao) to the Indian Navy.
6. MDL became the first shipbuilding company to introduce the use of Virtual Reality (VR) for ship design reviews and approvals by the Navy. It has helped reduce timelines for finalizing approvals of design by almost 2-3 years for every project.
7. Mazagon Dock Shipbuilders Ltd (MDL) recently launched two frontline warships namely Udaygiri- the second Stealth Frigate of Nilgiri Class and Surat- the fourth Missile Destroyer of Visakhapatnam class.
8. Company has Indigenously developed Self Propelled Expendable Underwater Target which can be utilized by ships, submarine, helicopters and aircraft for Anti-Submarine exercises. It imitates the acoustic signature of a maneuvering Submarine by emitting active sonar signal in multiple / wide broadband width and it is used to train the crew of IN ships, submarine, aircraft in detecting, tracking & attacking an underwater target.
9. Company has recently signed individual Shipbuilding Contracts with the European client for the construction of three (03) units of 7,500 DWT Multi-Purpose Hybrid Powered Vessels for a value of approximately $42 million.
10. Company has also developed Solar Electric Hybrid Boat which is an eco-friendly, fossil fuel free solution to water transportation requirement. It can be seen as a future of small and medium size ferries; these boats provide a cost-effective clean energy alternation to conventional Diesel boats.
11. The company is also developing ‘AUV Swarm Drones’ as its iDEX initiatives in Collaboration with M/s Sagar Defence Engineering Pvt. Ltd. The swarm of AUVs will help in locating mine and neutralizing it after getting confirmation from Mothership.
12. It is developing 2 nos. MTE prototype for Indian Navy under Make II in collaboration with M/s Bharat Forge Ltd. and technology partner M/s Edge lab, Italy. MTE simulates a target echo for an incoming active torpedo and simulates a target radiated noise in case of an incoming passive homing torpedo. It is used to attract the torpedo away from the counter maneuvering submarine (target) by emulating the acoustic and dynamic behavior of a target submarine.

In last 3 Years the stock gave a return of 990.21% as compared to the rise of Sensex and Nifty in the same period.

Company has been the leading ship and submarine builders for the country since many years with proven record and expertise developed obver the years by the company. In past few years Ministry of Defense have been heavily investing for strengthening the Defence forces of India in all manner including Navy, Army and Airforce as an effect of which Mazagon Dock enjoys a very sweet spot for upcoming defence orders as well steady stream of revenue under Make In India and Atma Nirbhar Bharat Initiative. Company’s special vessels such as FCEV vessel, Solar Hybrid Boat, Air boat and Swarm AUV makes it the market leader and the only company in India to have all sorts of expertise gelled up with experience under one roof. Considering company’s huge order book position, prover financial track record, GOI’s investments for defence and indegeniously developed products for Indian Navy and MOD, investors can invest in this defence company on long term perspective.

HET ZAVERI​​

info@smartinvestment.in

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