COCHINSHIP - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 19 Sept 25, 2:16 pm

Fundamental Rating: 4.3

📊 Core Financials

Earnings & Profitability: EPS of ₹32.3 and quarterly PAT of ₹188 Cr (down from ₹285 Cr) show strong earnings, though recent profit dipped slightly (3.88%).

Return Metrics: ROCE at 20.4% and ROE at 15.8% are solid, indicating efficient capital deployment and healthy shareholder returns.

Debt Profile: Debt-to-equity of 0.09 — nearly debt-free, which enhances financial stability.

Cash Flow: Not explicitly stated, but strong margins and low debt suggest robust operating cash flows.

💰 Valuation Indicators

Metric Value Insight

P/E Ratio 59.0 Expensive vs. industry PE (55.5)

P/B Ratio ~8.95 High premium over book value

PEG Ratio 4.60 Overvalued relative to growth

Dividend Yield 0.51% Modest, not a major income play

Valuation is stretched, especially given the elevated PEG ratio and premium over book value.

🛳️ Business Model & Competitive Advantage

Cochin Shipyard Ltd. is India’s leading shipbuilding and ship repair company. Its strengths include

Strong order book worth ₹21,100 Cr across 75 vessels

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Strategic MoUs with global players like Drydocks World UAE and HD KSOE South Korea

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Expertise in building advanced vessels (e.g., Platform Supply Vessels, luxury river cruises)

Government contracts and defense sector exposure

The company has guided for 14–15% revenue growth and ~15% PAT margin for FY26

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, reinforcing its long-term growth trajectory.

📈 Technical & Sentiment Indicators

RSI: 69.7 – Approaching overbought territory.

MACD: 24.3 – Bullish momentum.

Volume Surge – Above weekly average, indicating strong interest.

DMA 50 & 200: Current price is above both, confirming technical strength.

Brokerage firm Anand Rathi sees a potential upside of 22%, targeting ₹2,200, and recommends accumulation in the ₹1,780–₹1,820 range

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💡 Investment Strategy

🔽 Entry Zone

Ideal Buy Range: ₹1,780–₹1,820, near DMA 50 and brokerage support zone

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Current Price ₹1,907: Slightly above ideal entry, but still within accumulation range.

🕰️ Long-Term Holding

Strong Hold or Accumulate on Dips: Solid fundamentals, strategic partnerships, and defense exposure make it a promising long-term compounder.

Watch Valuation & Profit Trends: Elevated PEG and recent PAT dip suggest caution on short-term upside.

Let me know if you'd like a peer comparison with Mazagon Dock or a forecast model for FY27.

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