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New Delhi: Cochin Shipyard Limited’s (CSL) shares fell 7% on May 18 following concerns about the company’s declining sales figures. The state-owned defense PSU has seen its net sales drop 14.28% year on year to ₹1,641.33 crore for Q4 FY26 as the company has witnessed the suspension of a few vessel projects along with some ongoing governance concerns. This comes at a time when the company’s quarterly operating EBITDA has climbed to ₹466.82 crore, even as its net profit has declined by 3.7% year on year to ₹276.48 crore. For the full fiscal year, the company’s consolidated net profit has fallen 13.5% to ₹716 crore, mostly due to rising subcontracting and employee overheads.
Along with its financial results, the board of directors has also recommended a final dividend of ₹1.50 per share for FY26.
The drag on sales growth
Cochin Shipyard has witnessed various challenges that have affected its sales. One of the challenges has come from project delays that have cost it a combined ₹215.7 crores in liquidated damages (LD) while the company has migrated toward Hydrogen Fuel Cell Vessels that have impacted its downline.
Compliance Failures
The company has witnessed challenges regarding the non-appointment of independent directors on its boards and the delay in appointing an Audit Committee and Nomination and Remuneration Committee.
Despite all of this, CSL’s long-term defense pipeline has remained structurally sound, despite its near-term challenges. The 7% decline in its share prices have come been a reaction to its Q4 results. The company aims to fulfill its targeted pipeline of fresh multi-billion-dollar commercial and defence vessel orders heading into FY27.
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