Mazagon Dock Shipbuilders to Consider Stock Split and Dividend

Shares of Mazagon Dock Shipbuilders Ltd., a state-run defense company in India, are drawing significant investor attention as the company prepares for a key board meeting scheduled for October 22, 2024. According to an exchange filing made on Thursday, the board will discuss a proposal for a stock split and the declaration of an interim dividend for the fiscal year 2024-25.

Notably, this will be the first stock split in the history of Mazagon Dock Shipbuilders. The company’s shares have been on a robust upward trajectory over the past three years, largely driven by India’s strategic initiatives in boosting domestic defense capabilities through the ‘Make in India‘ and ‘Atmanirbhar Bharat Abhiyan’ missions. Despite a recent correction, the shares remain 84% higher on a year-to-date basis as of 2024.

As of the latest available data, the Indian government holds an 84.83% stake in Mazagon Dock, maintaining a majority interest well above the mandatory public shareholding requirement of 75%. Retail investors have shown increased interest, expanding their stake from 9% at the end of June 2024 to 10.6% by the end of September.

Financial reports indicate a robust performance for Mazagon Dock Shipbuilders. For the quarter ending in June 2024, the company reported a profit after tax of ₹696 crore, marking a 121% year-on-year increase. Revenue from operations rose to ₹2,357 crore, up 8.5% from the same period the previous year.

Mazagon Dock Shipbuilders has a diverse product portfolio, including the construction of advanced warships and submarines. Since 1960, the company has built 802 vessels, including 28 warships and 7 submarines. The company also produces various kinds of maritime vessels for both domestic and international clients.

On the stock market, the company’s shares have shown volatility, reaching an all-time high of ₹5,860 in July 2024. However, the stock has corrected nearly 30% since then, closing at ₹4,232.1 on Thursday, October 17, 2024, which marked a 2.2% decline on the day. The stock’s market capitalization currently stands at ₹85,000 crore.