Garden Reach Shipbuilders Q1 Results: Revenue growth of 30%, margins expand

Shares of state-run Garden Reach Shipbuilders Ltd. are trading 1.7% lower on Friday, August 8, after its June quarter results announcement.Revenue for the quarter increased by 29.7% from last year to ₹1,309.8 crore. The company had reported a topline of ₹1,009.7 crore. However, the revenue growth was below expectations of 43% on a year-on-year basis,

The company’s revenue growth for the quarter was aided by an advanced stage of order execution of P17A Frigates.

Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) for the quarter nearly doubled to ₹111.8 crore from ₹56.3 crore last year. However, this figure was below expectations of ₹137 crore.EBITDA margin for the quarter saw an expansion of 290 basis points from last year to 8.5% from 5.6% last year. The figure was lower than the expectation of 9.53%

Award date and execution of Next-gen Corvettes (NGCs) worth over ₹25,000 crore and execution progress for the ASW Shallow Water Crafts are some of the key factors to watch out for.

During the March quarter earnings call, the management had disclosed that its order book stood at ₹22,680 crore and the company is likely to reach peak execution by the end of the current financial year.

Shares of Garden Reach Shipbuilders are looking to recover from the lows of the day, currently trading 1.3% lower at ₹2,514. The stock is down 30% from its recent record high of ₹3,538.