Mazagon Dock Shares Plunge 7% After Q4 Net Profit Halves to ₹325 Crore

Shares of Mazagon Dock Shipbuilders Ltd declined sharply on Friday, May 30, falling more than 7% after the state-owned defence company posted a significant drop in quarterly profit for the period ended March 31, 2025.

Profit Plunges 51% in Q4 FY25

The Mumbai-based defence PSU reported a 51% year-on-year fall in net profit for the fourth quarter of FY25. Net earnings came in at Rs 325.3 crore, a steep drop from Rs 663 crore recorded in the same quarter last year.

Although consolidated revenue from operations rose marginally by 2.3% to Rs 3,174.4 crore from Rs 3,103.7 crore in the year-ago period, the company’s operating performance was significantly impacted.

EBITDA dropped 83% to Rs 90 crore, compared to Rs 524 crore reported in the same quarter of the previous fiscal.

Annual Results Show Growth

Despite the disappointing quarterly performance, Mazagon Dock posted a strong full-year financial result. For FY25, net profit rose 25% to Rs 2,414 crore, up from Rs 1,937 crore in FY24.

Full-year revenue increased by 21%, reaching Rs 11,432 crore compared to Rs 9,467 crore in the previous year.

At 9:18 am on Friday, the company’s shares had declined by 7.6% to Rs 3,485.4 on the NSE.

Defence Orders in Focus

Investor attention remains on Mazagon Dock due to reports of upcoming major defence orders.

As per a May 26 report by the Times of India, citing defence ministry sources, a procurement proposal for 12 advanced minesweepers or mine countermeasure vessels (MCMVs) is expected to be placed before the Defence Acquisition Council, led by Rajnath Singh. The estimated cost for the project is around Rs 44,000 crore.

These MCMVs are intended to enhance India’s maritime defence capabilities by detecting, tracking, and destroying underwater mines, ensuring safe navigation for naval vessels and addressing maritime security threats.

Recent Stock Performance and Correction

Over the past year, Mazagon Dock shares have rallied 130%, delivering substantial returns to investors. During the same period, the Nifty 50 index rose by 10.4%.

However, the stock corrected sharply following the Q4 earnings report, closing Friday 7.18% lower at Rs 3,480.10. This closing price marks a 7.89% drop from its all-time high of Rs 3,778, recorded in the previous trading session.

Still, the stock has seen a 13.80% rise over the past month. While revenue increased year-on-year in Q4, the sharp decline in EBITDA raised concerns among investors.

Market Experts Weigh In

Mayuresh Joshi, Head of Equity Research at William O’Neil India, pointed out that although tailwinds remain for the defence sector, execution of orders will be a key focus.

“Timelines are going to be extremely critical for this line of business,” Joshi told Business Today, also noting that current valuations for Mazagon Dock are exceptionally high.

Technical Analysis and Stock Outlook

Technically, Mazagon Dock shares traded below their 5-day and 10-day simple moving averages (SMAs), while remaining above the 20-day to 200-day SMAs.

The 14-day Relative Strength Index (RSI) stood at 60.17. Generally, an RSI below 30 indicates an oversold condition, while values above 70 suggest the stock is overbought.

Osho Krishan, Senior Analyst – Technical & Derivative Research at Angel One, said the recent surge had increased the chances of a price correction.

“Mazagon has support around Rs 3,300, followed by Rs 3,280 and Rs 3,000 levels. On the higher end, a breakthrough above Rs 3,600-3,680 could only trigger fresh momentum in the coming period,” he stated.

Jigar S Patel, Senior Manager (Technical Research Analyst) at Anand Rathi, identified Rs 3,400 as immediate support and Rs 3,600 as resistance.

“A decisive move above Rs 3,600 level may trigger a further upside towards Rs 3,720. The expected trading range will be between Rs 3,350 and Rs 3,720 for the short term,” he said.

AR Ramachandran, a SEBI-registered independent research analyst, said that the stock has strong resistance at Rs 3,775. “A daily close below Rs 3,426 could lead to a downward target of Rs 3,020 in the near term,” he added.

Government Stake and Business Role

Mazagon Dock Shipbuilders is one of India’s premier shipbuilding yards, providing services primarily to the Indian Navy and Coast Guard. As of March 2025, the Indian government held an 84.83% stake in the company.