Shares of Cochin Shipyard Ltd. will be in focus on Wednesday, November 11, after the company reported a weak set of September quarter results, with a sharp decline in profitability despite steady revenue growth. On a standalone basis, Cochin Shipyard's revenue increased by 12.9% from last year to ₹1,074 crore.
However, that was the only metric that saw an increase during the quarter. The company's Earnings Before Interest, Tax, Depreciation and Amortisation for the quarter declined 31% from last year to ₹51 crore, while margins declined to 4.1% from 6.6% during the year-ago period.
Net profit for the period also halved to ₹53 crore from ₹108 crore during the same quarter last year. How Did Cochin Shipyard's Business Segments Fare? The key concern was the weak performance of the shipbuilding segment. Revenue from the segment increased to ₹783 crore from ₹759 crore in the year-ago quarter.
However, the profit before tax for the segment swung to a loss of ₹6 crore from a profit of ₹150 crore. In contrast, the ship repair business delivered a stronger performance, with revenue rising to ₹466 crore from ₹360 crore and segment PBIT more than doubling to ₹143 crore from ₹67 crore.
Earlier, the company had guided for revenue growth of 12% with a potential to reach 15% on the upside, along with EBITDA margin of 14%. At the end of the first half of the year, revenue growth stood at 7%, while margins stood at 9%. At the end of the quarter, the company's borrowings have increased sharply by 62% from last year, while consolidated operating cash flow at the end of the first half of the year, stood at a negative ₹635 crore.
Shares of Cochin Shipyard ended 4.3% higher on Monday at ₹1,290. The stock is down 30% from its 52-week high of ₹1,842.8.