COCHINSHIP - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

Investment Rating: 3.5

⚓ Fundamental Analysis: Cochin Shipyard Ltd. (COCHINSHIP)

Cochin Shipyard is a prominent player in India's defense and commercial shipbuilding sector. While its operational metrics are solid, current valuations and growth expectations suggest caution for long-term investors.

Metric Value Implication

Market Cap ₹46,428 Cr Mid-to-large cap; strong government backing

Stock P/E 56.1 Overvalued vs. industry PE of 50.6

PEG Ratio 4.16 Very high; growth not justifying valuation

ROE / ROCE 15.6% / 20.0% Solid but not exceptional

Dividend Yield 0.55% Low; not attractive for income investors

Debt-to-Equity 0.10 Very low; strong balance sheet

EPS ₹31.4 Decent earnings base

Qtr Profit Var +10.9% Moderate growth momentum

FII/DII Holding Change +0.99% / -0.49% FII accumulation; DII trimming possibly due to valuation concerns

📉 Technical Analysis

Current Price: ₹1,766

DMA 50 / DMA 200: ₹1,919 / ₹1,701 → Trading below 50 DMA; short-term weakness

RSI: 31.1 → Near oversold zone; potential for technical bounce

MACD: -67.1 → Strong bearish momentum

Volume: Above average; possible accumulation at lower levels

💰 Ideal Entry Price Zone

Given the valuation and technical setup

Ideal Entry Zone: ₹1,600–₹1,700

This range offers better risk-reward near 200 DMA and support levels

Avoid fresh entry above ₹1,850 unless earnings growth accelerates

🌱 Long-Term Investment Outlook

Why it’s a mixed candidate

Strong government contracts and strategic importance

Low debt and decent ROCE — operationally sound

FII interest rising — institutional confidence

Concerns

PEG > 4 — valuation far exceeds growth

P/E of 56 — premium pricing not backed by explosive earnings

RSI and MACD suggest short-term weakness

Dividend yield low — not ideal for income portfolios

🏁 Exit Strategy / Holding Period

If you already hold COCHINSHIP

Holding Period: 1–3 years depending on defense order visibility and earnings trajectory

Exit Strategy

Consider trimming near ₹2,500–₹2,700 (recent high) if valuation remains stretched

Hold only if ROCE stays above 18% and PEG drops below 2

Reassess if profit growth slows or order book weakens

Would you like a comparison with other defense-sector stocks like Mazagon Dock or HAL to evaluate better long-term opportunities?

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