Mazagon Dock, other shipbuilding stocks decline up to 4%, but keep their 2025 gains intact

Shipbuilding stocks Cochin Shipyard Ltd., Mazagon Dock Shipbuilders Ltd. and Garden Reach Shipbuilders & Engineers Ltd. were trading with losses up to 4% on Tuesday, December 30.

This comes a day after the Defence Acquisition Councilapproved proposals worth ₹79,000 crore, clearing major upgrades for the Indian Army, Navy and the Air Force.

The council was chaired by Defence Minister Rajnath Singh. The approvals pave the way for more indigenous manufacturing of defence products.

Post the meeting, brokerage firm Motilal Oswal released a note, stating it was largely positive on defence stocks.

It said the approvals span across a wide spectrum of capabilities, including missiles, munitions, air defence systems, surveillance and communication equipment, training systems and naval support platforms.

While the acceptance of necessity (AoN) approvals

do not immediately translate into order inflows, the breadth and scale of the approvals materially de-risk order inflows for key defence PSUs and select private players over the next two to four years, the brokerage said.

For the three shipbuilding stocks, Motilal Oswal said the procurement of BP tugs and allied marine support vessels opens up opportunities for these shipyards.

Shares of Cochin Shipyard were down 1.8% at ₹1,608 apiece, while Mazagon Dock were down 4.4% at ₹2,427 apiece and Garden Reach Shipbuilders were down 3.1% at ₹2,405.5 apiece.

Despite the fall seen in today's session, shares of Mazagon Dock Shipbuilders are up 9% so far this year, and have kept their record of delivering positive returns every year since listing in 2020 intact.

Shares of Garden Reach Shipbuilders are also up nearly 50% so far this year, continuing their run of delivering positive annual returns every year since 2020, which is the only negative year the stock has had since its listing in 2018.

Cochin Shipyard's shares have been underperformers among its peers, up only 4.5% so far this year, which will be their fourth straight year of positive returns. However, this comes after the stock gained 127% in 2024 and another 150% in 2023.

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