Mazagon Dock Shipbuilders' shares have witnessed a remarkable surge of approximately 40% in the last six months. The stock experienced a sharp rise on Friday following the announcement of the acquisition of another company.
Defense sector stocks once again gained momentum in the stock market on Friday. Specifically, shares of Mazagon Dock Shipbuilders Limited (MDL) saw a significant increase. The company's order book has surpassed ₹32,000 crore, and its shares have yielded a return of approximately 40 percent in the past six months. Investor interest has been reignited due to the company's foreign acquisition deal.
Share sees renewed buying, closing with a 2 percent gain
In today's trading session, MDL shares closed at ₹3,188, up by more than 2 percent. The company's current market capitalization is ₹1.28 lakh crore. It has provided a return of approximately 40 percent in the last six months. The increasing order book and news of foreign expansion have made it a focus in the stock market.
Acquisition of Colombo Dockyard confirmed, deal worth ₹452 crore
Mazagon Dock Shipbuilders announced on Friday that it will acquire a 51 percent stake in Colombo Dockyard PLC (CDPLC), a Sri Lankan company. This acquisition will cost approximately 52.96 million US dollars, equivalent to around ₹452 crore. This investment is being made from a strategic perspective to strengthen the company's global network and further advance research and development.
This acquisition will be from the existing majority shareholder, Onomichi Dockyard Company Limited, and includes primary subscription as well as secondary share acquisition. The entire process is planned to be completed within the next 4 to 6 months.
CDPLC: A prestigious company in Sri Lanka
CDPLC was established on June 14, 1974, and is registered as a public limited company under the laws of Sri Lanka. The company is primarily engaged in shipbuilding and ship repairing. In the financial year ending December 31, 2024, its consolidated turnover was LKR 25,447 million and net assets were LKR 5,311 million. Moreover, its performance has been consistently better in previous years.
'Navratna' status, debt-free status
MDL was recently awarded the 'Navratna' status by the Government of India. The company is completely debt-free and its order book reached ₹32,260 crore as of March 31, 2025. The company has built over 800 ships since 1960, including warships, submarines, passenger, and cargo ships. Due to this experience and technical expertise, the company's name is counted among the foremost in the defense sector.
Multibagger return of the share
MDL shares have given a return of more than 2400 percent in the last 3 years, which puts it in the category of a multibagger stock. Its 52-week low has been ₹1,917.95 and the current price is about 66 percent higher than that level. This means that investors who invested in this stock have received a great return, and there is still potential in it.
Strong activities happening in the defense sector
For the past few years, the Government of India has been emphasizing defense projects under Make in India and Atmanirbhar Bharat. This is directly benefiting PSU companies, especially those that are working on shipbuilding, weapons systems, and defense-related projects. Mazagon Dock is one of them, which is continuously receiving new orders.
Momentum is maintained in the market
There was a positive mood in the stock market today as well. The Nifty touched a high of 25,654 during the day and closed at 25,638, with a gain of 89 points. There was a buying atmosphere in defense stocks, auto, and infrastructure shares. Apart from Mazagon Dock, investors also showed interest in stocks like HAL, Bharat Dynamics, and Cochin Shipyard.
Further rise can be seen in the stock
Brokerage houses and analysts believe that the momentum in Mazagon Dock may still continue. The company's debt-free status, b order book, international expansion strategy, and increasing demand in the defense sector make it a b contender. The foreign acquisition will also provide the company access to new markets, which is expected to expand both its profits and business.
Thus, Mazagon Dock Shipbuilders Limited has once again come into the limelight of investors. Its strategy on the domestic and international front is clear: expansion, strength, and advancement in technology. This is why its stock is once again in the market's discussion and is attracting investors.
