Cochin Shipyard shares slide 4% amid profit booking after 76% rally in a month. What should investors do?

Synopsis

Cochin Shipyard shares: The rally was driven in part by heightened investor interest in defence-sector stocks, with Cochin Shipyard emerging as a key gainer amid increasing optimism about India’s naval expansion. The stock saw a sharp rise in trading volumes and outperformed the broader market indices.

The shares of Cochin Shipyard on Monday fell 3.6% to their intraday low of Rs 2,305.30 on the BSE as investors chose to book profits after surging 76.3% in the past month.

In the last week alone, the stock rallied 30.7% to its weekly high of Rs 2,545 on Friday.

The surge was also attributable to the strong investor interest in defence-related stocks, with Cochin Shipyard standing out as a major beneficiary amid growing optimism over India’s naval expansion plans. The stock witnessed a significant rise in trading volumes and outpaced the broader market indices.

Cochin Shipyard, the largest public sector shipbuilder in India, has played a pivotal role in the nation’s maritime growth. The company builds and maintains a diverse fleet—including aircraft carriers, patrol vessels, and tankers—for the Indian Navy and Coast Guard. Its growing order book and robust execution capabilities have attracted significant investor interest in recent months.

What should investors do with Cochin Shipyard shares?

The stock has witnessed a vertical rally over the past month, gaining nearly 76% during this period.

“The trend remains positive, with potential for further upside in the short term. A 'buy-on-dips' approach appears more prudent than chasing the price at current levels,” said Rupak De, Analyst at LKP Securities.

Also read: MCX shares rise 4%, hit lifetime high on Sebi’s nod for launch of electricity derivatives

He believes accumulating the stock in the Rs 2,200–2,100 range could offer a good entry opportunity, with a stop-loss placed below Rs 2,030. On a recovery, the stock may rise back towards Rs 2,700 or higher.

Cochin Shipyard Q4 results

Cochin Shipyard recently posted a 10.8% year-on-year rise in net profit, reaching Rs 287 crore for the March quarter. Revenue grew sharply by 37% to Rs 1,758 crore. However, the company saw a 7.6% decline in EBITDA to Rs 266 crore, with operating margins narrowing significantly by 730 basis points to 15.10%, down from 22.40% in the same quarter last year.

Despite the margin pressure, the company maintains a strong financial footing, with a low debt-to-equity ratio of 0.01 as of March 2025, slightly up from 0.00 in March 2024.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

...moreless

...moreless