Buy Mazagon Dock Shares: Analysts See Up to 27% Upside After Q1 Results

Mazagon Dock Shipbuilders Ltd., India’s leading shipbuilder, has reported its Q1 FY26 earnings, reflecting continued momentum in project execution with key program updates highlighting strong delivery progress and robust order visibility.

The company’s revenue grew 11.4% YoY to Rs 26.2 billion, while both Ebitda and PAT declined sharply by 53% and 35% YoY to Rs 3 billion and Rs 4.5 billion, respectively. This performance fell short of the brokerage’s estimates, which projected revenue at Rs 28.2 billion, Ebitda at Rs 6.2 billion, and PAT at around Rs 7 billion.

Despite the disappointing earnings, Nirmal Bang, a leading brokerage firm, maintains its ‘Buy’ rating on the stock, citing robust growth prospects and a strong order book.

‘We expect Mazagon Dock Shipbuilders Ltd. to deliver robust growth with CAGR of ~21% in revenue, ~22% in Ebitda, and ~17% in PAT over FY25–FY27E,’ said the brokerage in its report. ‘The company is confident about securing the P75 additional submarine and P75I submarine contracts in FY26, which is expected to expand its order book from Rs 320 billion to over Rs 1.25 trillion.’

The brokerage further highlighted that the leverage from these large-scale contracts, combined with operational efficiencies from initiatives like Shipyard 4.0 and its digital transformation roadmap, should enhance margins and overall profitability.

The stock is trading at a one-year forward P/E of ~33.8x, valuing the company at 45x Jun-27E EPS, which is above its three-year average multiple of 22x. This valuation implies a target price of Rs 3,540, thereby offering an upside of 26.9%.

Nirmal Bang’s analysts believe that the stock’s current valuation provides an attractive entry point for investors. ‘We maintain our Buy rating on the stock, and recommend investors to accumulate the stock with a target price of Rs 3,540,’ they said in their report.

With its strong order book, robust growth prospects, and attractive valuation, Mazagon Dock Shipbuilders Ltd. looks like an attractive investment opportunity for investors seeking exposure to the Indian shipbuilding and defense sectors.

Key Highlights:

• Mazagon Dock Shipbuilders Ltd. reported Q1 FY26 earnings, reflecting continued momentum in project execution.
• The company’s revenue grew 11.4% YoY to Rs 26.2 billion, while both Ebitda and PAT declined sharply.
• Nirmal Bang maintains its ‘Buy’ rating on the stock, citing robust growth prospects and a strong order book.
• The company is confident about securing the P75 additional submarine and P75I submarine contracts in FY26, which is expected to expand its order book.
• The stock is trading at a one-year forward P/E of ~33.8x, valuing the company at 45x Jun-27E EPS.

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