Cochin Shipyard Q4 Results: Revenue Soars 38%, Profit Growth Slows Amid Rising Costs

Cochin Shipyard, one of India’s leading shipbuilding and maintenance companies, has announced its results today for the fourth quarter of the fiscal year 2025. The company recorded 38% growth in revenue during the quarter, along with a decent surge in profits. Following the results, the share price of the company surged over 7% today.

Key highlights

• Revenue rose 38.5% YoY to ₹1,807 crore in Q4 FY25, up from ₹1,305 crore in Q4 FY24.
• Net profit increased 7.6% YoY to ₹285 crore, compared to ₹265 crore a year ago.
• EBITDA stood at ₹409 crore with an EBITDA margin of 24.8%; net profit margin at 17.2%.
• Ship repair revenue grew 178% YoY to ₹836 crore, forming 50.7% of total operating revenue, while ship-building revenue declined 12% YoY to ₹815 crore.
• For full year FY25, revenue rose 24.2% to ₹4,908 crore and net profit grew 3.7% to ₹843 crore.

Cochin Shipyard’s revenue crosses ₹1,800 Cr in Q4

The revenue of Cochin Shipyard went up 38.5% YoY to ₹1,807 crore during Q4 FY25 as compared to ₹1,305 crore generated in Q4 FY24. Profit for the company also grew 7.6% to ₹285 crore in the quarter against ₹265 crore recorded a year ago. Despite the strong growth in revenue, the profit only went up 7.6%, which could be attributed to the heavy expenditure during the period.

The total expenditure of the company surged 49.1% to ₹1,430 crore during the quarter from ₹959 crore, a year earlier. The cost jump was mainly led by subcontract and other direct costs, which formed 24.1% of total expenses and shot up 113.1% to ₹345 crore in Q4. Cost of materials (including adjustments for changes in working capital) went up only 10% to ₹651 crore and accounted for 45.5% of the total cost. Employee benefits cost for the company increased 5.8% to ₹111 crore.

The EBITDA of the company registered at ₹409 crore with an EBITDA margin of 24.8%, while the net profit margin stood at 17.2% for Q4 FY25.

Source: Company filings

On an annual basis, the total revenue of Cochin Shipyard spiked 24.2% to ₹4,908 crore in FY25 as compared to ₹3,953 crore in FY24. Profit after tax of the company, however, grew only 3.7% YoY to ₹843 crore during FY25.

Source: Company filings

Cochin Shipyard’s share price surged 7.27% today to ₹1,823 per share with a market cap of ₹47,673 crore or $5.5 billion.

How does Cochin Shipyard make money?

Ship-building: Cochin Shipyard manufactures tankers, product carriers, bulk carriers, passenger vessels, and air defence ships. This vertical formed 49.3% of the operating revenue during the quarter. Collections from ship-building dropped nearly 12% YoY in Q4 to ₹815 crore.

Ship repair: It also started ship repairing services in 1982 and does upgrades and repairs for all types of ships, including ships for the oil exploration industry. This segment cornered 50.7% of the revenue and surged 178% YoY to ₹836 crore during the fourth quarter of FY25.

What’s leading the surge in Cochin Shipyard share price?

Strong order book: Cochin Shipyard’s revenue is expected to grow at a decent pace in the near term due to its healthy order book and capability of building and repairing all types of vessels. As of December 2024, the company’s order book was recorded at ₹21,784 crore, which is more than 4x of its total annual revenue worth ₹4,908 crore during FY25.

Improved credit profile: The company has repaid ₹100 crore non-convertible bonds during December 2023, which accounted for 81% of its total long-term debt in FY23. Additionally, it has not taken any long-term debt in the first nine months of FY25, which led to an improved debt-to-EBITDA ratio of 0.17x in FY24 against 0.41x in FY23. The existing debt of ₹478 crore in FY25, is primarily consists of lease liabilities.

Order Book Concentration: Though the company’s large chunk (~65%) of order book comes from government contracts, it is expected to come down over the long term as the company is winning orders from other players and venturing into niche vessel construction.

Key takeaways

During FY25, Cochin Shipyard did capex on two major projects via spending ₹793.44 crore on the International Ship Repair Facility and ₹1,319.40 crore on the New Dry Dock.

Cochin Shipyard, a key player in India’s defence sector, which builds and maintains naval vessels, has also benefited from the recent rally in defence stocks. Last week, stocks in the defence sector surged significantly. Cochin Shipyard, along with industry peers such as Mazagon Dock and Bharat Dynamics, saw increased investor interest amid rising geopolitical tensions and a promising order outlook.

In the last five days, the share price of Cochin Shipyard surged 28% while Mazagon Dock and Bharat Dynamics are up 13.27% and 20.68%, respectively. Visit here to get the top 10 defence stocks in India.

Cochin Shipyard reported a strong Q4 FY25, with revenue rising 38.5% YoY to ₹1,807 crore and net profit increasing 7.6% to ₹285 crore. The modest profit growth, despite higher revenue, was due to a 49.1% surge in expenses, primarily from subcontract and direct costs. Annually, revenue grew 24.2% to ₹4,908 crore in FY25, while net profit rose 3.7% to ₹843 crore. Shipbuilding revenue dropped 12% while ship repair revenue jumped 178% YoY in Q4. The company also announced a dividend of ₹2.25 per equity share.

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