Unlisted Shares

Strength

• Highest ever Order Book of approx. Rs 20,000 Cr
  
• Net Worth reached an all-time high of Rs 1,246 Cr
  
• Signed contract for 07 Next Generation Offshore Patrol Vessels NGOPV worth Rs 6,000 Cr (approx)
  
• In-house design capabilities using computerized modeling and drafting software.​
  
• CRISIL Ratings has reaffirmed its ‘CRISIL AAA/Stable/CRISIL A1+’ ratings
  

Market Position

• The strategic importance of GSL to the Union Ministry of Defence (MoD) given the government’s focus on strengthening defense capabilities and indigenization of procurement, leading to sizeable order inflow and a healthy track record of execution with an overall of 5% market share approx.
  

Revenue Growth

• A swift order execution has led to a 17% increase in revenue, largely driven by Ship Repair vertical growth, consequently elevating the company's financial performance from ₹ 709.9 Cr in FY22 to ₹ 833.2 Cr in FY23.

Net Profit Margin

• The company's net profit margin is 19% which has grown by 53% from ₹ 101.1 Cr in FY22 to ₹ 154.5 Cr in FY23. The company's net profit margin has increased by 5% from 14% in FY22 to 19% in FY23 due to a rise in revenue from the completion of orders.

Return Ratio

• The ROE of the company stands at a rate of  12.9% in FY23 and showed a growth of 43.4% compared to FY22 and the ROCE of the company also stands at a rate of -0.4% in FY23 and also showed a decline of 55.5% compared to FY22.

Investment Thesis

• In FY24, the company started production of the signed contract worth Rs 5,965 Cr for the construction of seven Next Generation Offshore Patrol Vessels for the Indian Navy. With the signing of this contract, the Company's order book position has touched an all-time high value of more than Rs 20,000 Cr. which is to be executed in the next -7 years.
• After a detailed analysis of various factors such as industry growth, peer comparison, ratio analysis, etc. There's a potential for revenue growth next year as pending orders get fulfilled, potentially boosting net profits and margins. 
  
• Currently, GSL is trading at a PE of 120x whereas industry PE is trading at 67x which seems to be quite expensive stock right now. However, Considering the future aspect of potential growth drive through the completion of the order book value in the next 6-8 years and other metrices including the company's step toward technology integration with AI use, it is advisable to hold this stock.