Mazagon Dock shares soar amid talks of ₹35,000cr submarine deal
Stocks of Mazagon Dock Shipbuilders Limited, India's largest shipbuilder, surged by 4% following advanced discussions about the acquisition of extra Kalvari-class (Scorpene) submarines for the Indian Navy. The potential deal is valued at ₹35,000 crore and aims to strengthen India's submarine fleet. The three new submarines under negotiation, are reported to be bigger and equipped with state-of-the-art electronics, enhancing their strength as well as endurance compared to their predecessors.
A key player in India's defense sector
Mazagon Dock Shipbuilders Limited is a government-owned Public Sector Undertaking (PSU) operating under the Ministry of Defence. It is the designated shipyard for making naval vessels and submarines for the Indian Navy. The company's portfolio includes a wide range of products from cargo vessels to offshore platforms, destroyers, frigates, corvettes, and submarines.
Order book and pending approval
As of March 2024, Mazagon Dock has an order book of roughly ₹39,000 crore. It includes backlogs for the P-15 Bravo destroyers, P-75 submarines, and P-17 Alpha frigates. The company is currently awaiting approval from the Indian government for a submarine project worth ₹35,000 crore, to manufacture three more Scorpene class submarines. The first submarine of this class was inducted into the Indian Navy in 2017.
Mazagon Dock's stock performance
The Scorpene class submarines were developed by France's Naval Group under a deal inked with India in 2005. This agreement led to a full technology transfer from the French defense manufacturer to Mazagon Dock. Today, shares of Mazagon Dock were trading 2.97% higher at ₹4,009.75 apiece on the National Stock Exchange (NSE) around 11:22am. Over the past year alone, stocks of Mazagon Dock have rallied by as much as 220% since the company's debut on exchanges in 2020.
