The retail portion was subscribed 5.64 times, while the one reserved for non-institutional investors witnessed nearly 78 percent subscriptions.
Mazagon Dock Shipbuilders has set a price band for the issue at 135-145 per share. The issue will close for subscription on October 1. The supply is expected to rise around Rs 444 crore at the upper end of the price band and in the lower range around Rs 413 crore.
It is proposed that the company’s shares are listed on the BSE and NSE.
The company, established in 1934, is a public sector company ‘Mini-ratna-I’ dependent on the Department of Productio Defense (MoD). Based in Mumbai, core capabilities include the construction and repair of warships, submarines for the Indian Navy and other vessels for commercial clients.
With a capacity of 40,000 deadweight tonnes (DWT), MDSL is the only shipyard in India to have built conventional destroyers and submarines for the Indian Navy and is also the first shipyard to manufacture Corvettes (Veer and Khukri class) in India.
Amarjeet Maurya, AVP-Midcaps, Angel Broking said: “In terms of valuations, the pre-issuance P / E equals 6.1 times FY20 earnings (at the upper end of the issue price band), which it is minor compared to its peers such as Garden Reach Shipbuilders and Cochin Shipyard. Additionally, MDSL has a healthy ROE of around 16 percent along with a higher dividend yield and higher balance sheet cash among its peers. Therefore, considering these factors, we recommend ‘Subscribe’ to the issue with a long-term horizon. ”
Brokerage Geojit Financial Services also assigned a ‘Subscribe’ rating to the issue.
.
