Mazagon Dock Shipbuilders (MAZDOCK) Q4 22/23 earnings summary

Executive summary

• FY23 marked record revenue from operations of ₹7,827.18 crore and operating profit of ₹716 crore; PAT reached ₹1,072.72 crore, up 83% YoY.

• Two major naval platforms were delivered: destroyer INS Mormugao and Scorpene submarine INS Vagir; the order book stood at ₹38,755 crore.

• FY24 priorities include one destroyer delivery, targeted revenue growth of ~10%, higher repair revenue and pursuit of major submarine opportunities.

Financial highlights

• Standalone revenue from operations was ₹7,827.18 crore vs ₹5,733.28 crore in FY22; total income was ₹8,540.66 crore vs ₹6,166.91 crore.

• EBITDA was ₹1,511.28 crore vs ₹868.33 crore; PBT before exceptional items was ₹1,429.33 crore vs ₹786.66 crore.

• PAT was ₹1,072.72 crore vs ₹586.47 crore; EPS rose to ₹53.19 from ₹29.08.

• FY23 had no exceptional item; FY22 included ₹13.97 crore of lockdown-period employee costs.

• Excluding further liquidated-damages refunds, FY24 margins were expected to remain near the normal annualized cost structure; ₹174 crore LD refund was received in FY23.

Outlook and guidance

• FY24 revenue growth target was ~10%, with one destroyer targeted for delivery; management cautioned FY23’s ~37% YoY growth was not sustainable.

• Further LD refunds sought for Scorpene submarines 3–5 could support FY24 margins if approved then; refunds shifted to FY25 would defer the benefit.

• Repair revenue was expected to rise from FY23; the second submarine MRLC contract is valued at ~₹2,700 crore, with delivery in ~33 months.

• P75(I) bid preparation with TKMS was underway; the published Navy estimate was ₹43,000 crore, based on 2018 figures, with evaluation expected to take ~18 months after bids.

• Plans include a phased greenfield Nhava shipyard, a 12,000-tonne floating dry dock and a submarine launch facility targeted for September 2023.