Shipbuilding Stocks in Focus: GRSE, MDL, Cochin Rally Up to 14% on Growth Optimism

Shipbuilding stocks saw a major rally on Tuesday, with shares of state-owned shipbuilders rising by as much as 14% on the BSE, even as the broader market remained mostly flat. At 12:48 PM, the BSE Sensex was up just 0.13% at 80,420.

Mazagon Dock Shipbuilders (MDL) at All-Time High

Mazagon Dock Shipbuilders (MDL) stock touched a new high of ₹3,035, rising 9% in intraday trade. The stock surpassed its earlier record of ₹2,929.98, hit on July 5, 2024. This rise came with a more than twofold jump in trading volumes.

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GRSE Stock Jumps on Strategic Lease Deal

Garden Reach Shipbuilders & Engineers (GRSE) shares rose 14% to ₹1,990, with trading volumes jumping nearly 4 times. Over 11.3 million shares were traded on NSE and BSE combined.

GRSE’s rally follows its announcement of a 30-year non-renewable lease agreement with Syama Prasad Mookerjee Port, Kolkata. The lease will give GRSE access to valuable waterfront land in Howrah, which it plans to use for shipbuilding, repairs, and other engineering activities.

Cochin Shipyard Also Sees Sharp Gains

Cochin Shipyard shares surged 11% to ₹1,667.85. Trading activity spiked nearly 5 times on this counter, with over 7.6 million shares traded on NSE and BSE.

MDL Gains 58% Since February

MDL stock has climbed 58% from its February low of ₹1,917.95. MDL stands out as the only public sector defence shipyard that builds both destroyers and submarines. It currently has the capacity to build 11 submarines and 10 warships at the same time.

In April 2025, the government sold a 3.61% stake in MDL (14.56 million shares) through an Offer for Sale (OFS) at a floor price of ₹2,525.

Government Policies Supporting Shipbuilding Sector

The Union Budget 2025–26 has introduced several measures to support the shipbuilding sector:

• ₹25,000 crore maritime fund to boost infrastructure

• A revised Shipbuilding Financial Assistance Policy with an outlay of ₹18,090 crore

• Classification of large ships as infrastructure assets for easier financing

• Customs duty exemption on parts and raw materials used in shipbuilding extended for another 10 years

Boost from ‘Make in India’ and Sagarmala Project

The Indian Navy’s Indigenisation Plan (2015–2030) encourages greater participation from the private sector to meet defence needs using cost-effective and locally built components.
The Sagarmala Project aims to boost coastal and inland waterway traffic 15 times in 20 years. This would lead to a fivefold rise in port capacity and generate more ship repair business.

ICRA: India Can Become a Shipbuilding Hub

According to ICRA, India is well-suited to become a global shipbuilding hub due to its engineering skills, long coastline, low labour costs, and strategic location. Recent legislative efforts, like the Coastal Shipping Bill 2024 and the Merchant Shipping Bill 2024, also aim to support the industry. However, ICRA notes that more support is needed in the form of increased financial aid and tax incentives to compete with other countries.

Conclusion

India’s shipbuilding sector is gaining strong momentum, backed by government reforms, defence orders, and infrastructure expansion. As companies like MDL, GRSE, and Cochin Shipyard ramp up capacities and secure strategic partnerships, the industry is well-placed for long-term growth.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.                          

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