Garden Reach Shipbuilders approves ₹2,896 cr for greenfield shipyard at Raichak, West Bengal

Kolkata-based defence PSU Garden Reach Shipbuilders and Engineers Ltd on Monday, September 21, approved a ₹2,896 crore capital budgetary outlay for the construction of a greenfield shipyard at Raichak in West Bengal’s South 24 Parganas district.

The facility will enhance the company’s shipbuilding capacity across the naval and commercial segments. The approval was taken at the company's 423rd board meeting and follows GRSE's August 24 disclosure regarding capacity expansion through three new facilities, including Raichak.

First Quarter Results

Garden Reach Shipbuilders' net profit increased 43.8% to ₹172.8 crore during the quarter from ₹120.2 crore a year earlier. Revenue from operations rose 38.5% to ₹1,814.6 crore from ₹1,309.9 crore.

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Earnings before interest, tax, depreciation and amortisation (EBITDA) grew 33.3% to ₹149.2 crore from ₹111.9 crore. EBITDA margin, however, slipped to 8.2% from 8.5% in the corresponding quarter last year.

Total income for the quarter increased to ₹1,914.2 crore from ₹1,382.4 crore a year ago, while profit before tax rose 38.9% to ₹231.5 crore from ₹166.7 crore. Earnings per share improved to ₹15.09 from ₹10.49 in the year-ago period.

The company reported higher spending on raw materials during the quarter, with the cost of materials consumed rising to ₹1,244.2 crore from ₹679.9 crore a year earlier.

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Purchases of products for resale also increased to ₹128.1 crore from ₹72 crore, while subcontracting charges declined to ₹81.5 crore from ₹235.6 crore. Total expenses rose to ₹1,682.7 crore from ₹1,215.7 crore in the corresponding quarter last year.

GRSE's balance sheet remained strong, with the debt-equity ratio at 0.014 times as of June-end, compared with 0.012 times a year ago. Net worth increased to ₹2,799.7 crore from ₹2,198.8 crore, while the current ratio improved to 1.32 times from 1.18 times. Net profit margin also expanded to 9.52% from 9.17% a year earlier.

Shares of Garden Reach Shipbuilders and Engineers Ltd ended at ₹2,372.00, down by ₹41.00, or 1.70%, on the BSE.

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