Antic Broking has recommended investment in the shares of Mazagon Dock Shipbuilders (MAZDOCK), a leading company in the defense sector, with a 'BUY' rating.
The defense sector stocks are steadily gaining dominance in the Indian stock market, with Mazagon Dock Shipbuilders Limited emerging as a frontrunner. The rapid growth of this state-owned shipbuilding company in recent years has completely won over investors' confidence. Notably, the company's performance has not been limited to stock returns alone, but has also been shaped by strategic expansion and international deals, making it stand out.
Impressive 2500 Percent Return in Three Years
Mazagon Dock's stock has created a stir in the market by providing a return of nearly 2500 percent in the last three years. This is why small investors to large institutional investors are being drawn to this stock. A 420 percent increase in just two years and a nearly 50 percent increase in the last year have placed it in the multi-bagger category. On Friday, the share closed at ₹3,170 on the BSE, which is about 16 percent below its all-time high of ₹3,778.
Positive Outlook from Brokerage House
Antic Broking has given a 'BUY' rating to Mazagon Dock's stock and has set a target price of ₹3,858. This is about 22 percent higher than the current share price. The brokerage believes that the Sri Lanka deal and the Indian government's defense production policy could prove to be a major growth engine for the company.
Support from Government Policies
The 'Make in India' campaign and government incentives in the defense sector have strengthened Mazagon Dock. The incentives being provided by the government, especially in the shipbuilding sector, are directly impacting the company's operations. In addition, orders from the Navy and Coast Guard have made the order book very b.
Expansion and Strengthening of Order Book
Currently, the company's order book stands at around ₹39,000 crore. This includes several major projects, from Scorpene-class submarines to frigates and Coast Guard ships. The company's strategy is not to be limited to construction alone, but also to increase its activity in ship repairing and international projects.
Tremendous Growth in Financial Reports
Mazagon Dock has presented excellent results in the fourth quarter of the financial year 2024-25. The company's total revenue increased by 34 percent, while net profit saw a growth of 61 percent. The EBITDA margin has remained above 20 percent, which is much better than the industry average. Additionally, the company's balance sheet is almost debt-free and it also has a good cash reserve.
Strong Position on Technical Charts
According to technical analysis, Mazagon Dock's stock is currently trading above the 50-DMA and 200-DMA. The RSI, or Relative Strength Index, is near 64, which is slightly below the overbought zone and indicates that there is room for further growth in the stock. On daily charts, this stock is in a 'consolidation' phase and if it crosses the level of ₹3,200, a new rally could begin.
Increasing Interest of Foreign Investors
An increase has been seen in the holdings of both FIIs (Foreign Institutional Investors) and DIIs (Domestic Institutional Investors) in this stock. Both categories increased their stake in the March quarter. Along with this, mutual funds are also including this stock in their portfolios. This is strengthening the company's long-term position.
Special Recognition in the Defense Sector
Mazagon Dock is one of India's oldest and most trusted shipyards. It is a leader in the construction of advanced submarines and warships for the Indian Navy. The company's technical capabilities, skilled workforce, and b supply chain network keep it ahead of the competition in the market.
