Union Minister for Transport Nitin Gadkari during the listing ceremony of the Cochin Shipyard at BSE in Mumbai. Photo: PTI
After successfully completing its initial public offer (IPO) recently, Cochin Shipyard Ltd (CSL) has lined up expansion projects worth Rs 2,800 crore. The IPO's proceeds will be utilised to fund these expansions.
CSL, which comes under the Ministry of Shipping, was listed on the BSE and the National Stock Exchange last week.
The company has raised Rs 1,442 crore from the IPO, which has been a combination of fresh issue and offer for sale in the ratio of 2:1. The IPO was oversubscribed by over 75 times with more than Rs 1.11 lakh crore being raised against the offer of Rs 1,442 crore.
The issue also saw a strong interest from the retail segment with over 2 million applications, the highest in the last decade.
The qualified institutional buyer (QIB) portion was oversubscribed by over 63 times and the high net worth individual (HNI) portion was over subscribed by 287 times. After listing the shares on the exchange, CSL opened at a 20 per cent increase despite the markets being low.
The proceeds from the fresh issue part of the IPO, totalling around Rs 961 crore, will be used by CSL for part-funding of two expansion projects costing Rs 2,800 crore.
The projects are a dry dock at the Cochin Shipyard premises to accommodate bigger ships for building and repair and a ship repair facility in the adjacent Cochin Port Trust premises, which will involve setting up a ship lift and transfer system.
CSL is the largest public sector shipyard in India in terms of dock capacity. It caters to domestic clients engaged in the defence sector and clients engaged in the commercial sector worldwide for shipbuilding and ship repair. In addition to shipbuilding and ship repair, CSL also offers marine engineering training.
The company has exported around 45 ships to overseas customers and has the pride of building the first indigenous aircraft carrier for the Indian Navy.
CSL's diversified business profile and presence in multi maritime segments have resulted in strong financial fundamentals.
The company's turnover for 2016-2017 was Rs 2,059 crore as against a turnover of Rs 1,404 crore for 2011-12.
The profit after tax (PAT) for 2016-2017 was Rs 322 crore as against a PAT of Rs 172 crore for 2011-12. The net worth of the company as on March 2017 was Rs 2,031 crore as against Rs 1,051 crore at end of 2011-12.