Mazagon Dock Shipbuilders (MAZDOCK) Q1 24/25 earnings summary

Executive summary

• Strong and consistent performance reported for Q1 FY25, with management expressing confidence in maintaining similar results throughout the year, barring unforeseen liabilities or surprises.

• Delivered 802 vessels since 1960, including 28 warships and 7 submarines, and is the only Indian shipyard to have built destroyers, conventional submarines, and corvettes for the Indian Navy.

• Celebrated 250 years with significant milestones, including the launch of the 4th Stealth Frigate and delivery of the 3rd Destroyer ahead of schedule.

• Consistent profitability for over 20 years, zero debt, and a strong order book with strategic indigenization of warships.

• Board approved unaudited standalone and consolidated financial results for the quarter ended June 30, 2024, with a strong year-over-year growth in revenue and profit.

Financial highlights

• Standalone Q1 FY25 revenue from operations: ₹3,480 Cr, up from ₹2,405 Cr in Q1 FY24 and ₹3,104 Cr in Q4 FY24.

• Standalone EBITDA: ₹913 Cr in Q1 FY25, up from ₹404 Cr in Q1 FY24 and ₹900 Cr in Q4 FY24.

• Standalone PAT: ₹654 Cr in Q1 FY25, up from ₹287 Cr in Q1 FY24 and ₹666 Cr in Q4 FY24.

• Margins improved dramatically from 16% to 26% in Q1 FY25, attributed to release of excess provisions as project liabilities near completion.

• Employee costs as a percentage of sales have dropped from 15% to 9.5%, expected to remain low as sales rise and headcount remains stable.

Outlook and guidance

• Management expects to maintain performance and margins similar to FY24, provided no major liabilities arise.

• Revenue for FY25 is targeted to exceed the previous year, with more clarity expected after Q2.

• Three major deliveries targeted for FY25: one destroyer, one frigate, and the sixth submarine.

• For FY26, two frigates, one merchant vessel, and one fast patrol vessel are planned for delivery.

• Capacity to build 11 submarines and 10 warships concurrently, supporting future growth.