1. At a Glance – Blink and You’ll Miss the Rally
Garden Reach Shipbuilders & Engineers Ltd (GRSE) is what happens when a PSU decides to stop behaving like a sleepy sarkari office and starts acting like a defence-tech startup with discipline. Market cap stands at ₹28,870 crore, stock price around ₹2,519, and despite recent short-term consolidation, the long-term chart still looks like a Navy destroyer cutting through calm seas. Q3 FY26 delivered ₹1,896 crore revenue with PAT of ₹171 crore, clocking ~74% YoY profit growth. ROCE is cruising at 36.6%, ROE at 27.6%, and debt is basically decorative at ₹32 crore.
Order book? A fat ₹23,592 crore, mostly defence shipbuilding, stretching visibility well into FY29. Dividend yield is modest at 0.55%, but payout discipline is steady at ~30%. The valuation is rich at ~42x earnings, but this isn’t a random PSU anymore—it’s a strategic defence monopoly with execution muscle. Curious how a Kolkata shipyard quietly became one of India’s hottest defence stories?
2. Introduction – From Rusty Docks to Defence Darling
GRSE isn’t new. Incorporated decades ago and controlled by the Ministry of Defence, it has been building ships even before Dalal Street cared. Historically, PSUs like this were known for delays, cost overruns, and excuses longer than the Hooghly river. But somewhere along the way, GRSE flipped the script.
Today, it is the first Indian shipyard to export warships, has delivered 100+ warships to the Indian Navy and Coast Guard, and is executing some of the most complex naval programs in the country. The defence capex cycle, Atmanirbhar Bharat, and Navy’s aggressive fleet expansion have turned GRSE into a cash-generating execution beast.
Revenue growth over the last three years is running at 42% CAGR, profits at 42% CAGR, and TTM profit growth stands near 75%. This isn’t cyclical luck; it’s structural. The big question: is this sustainable excellence or just peak-cycle
euphoria?
3. Business Model – WTF Do They Even Build?
Think of GRSE as a warship factory with a side hustle.
Shipbuilding (89% of revenue)
This is the main event. Frigates, missile corvettes, anti-submarine warfare vessels, survey ships, patrol vessels—you name it, GRSE welds it. Clients are mostly the Indian Navy and Indian Coast Guard, meaning payments are reliable, contracts are long-term, and competition is limited.
Engineering Division (<1%)
Portable steel bridges, deck machinery, marine pumps. Sounds boring, but these are niche, high-reliability products designed for defence logistics.
Diesel Engines (3%)
At Ranchi, GRSE assembles and overhauls marine propulsion engines under license from MTU Germany. Not glamorous, but strategically important for indigenisation.
Bottom line: this is a high-entry-barrier, low-competition, government-backed monopoly-style business. If you had to explain it to a lazy investor: GRSE builds floating weapons platforms for the Indian Navy and gets paid on time. Simple.
4. Financials Overview – Numbers That Salute Back
Quarterly Performance Table (₹ Crore)
| Metric | Latest Qtr (Dec-25) | YoY Qtr (Dec-24) | Prev Qtr (Sep-25) | YoY % | QoQ % |
|---|---|---|---|---|---|
| Revenue | 1,896 | 1,271 | 1,677 | 49.2% | 13.1% |
| EBITDA | 172 | 75 | 156 | 129% | 10.3% |
| PAT | 171 | 98 | 154 | 73.9% | 11.0% |
| EPS (₹) | 14.91 | 8.57 | 13.43 | 74% | 11% |
Annualised EPS (Q1–Q3 avg): ~₹59–60, matching reported TTM EPS of ₹60.2.
Witty takeaway: This quarter didn’t just beat estimates—it torpedoed them.
5. Valuation Discussion – Expensive or Earned?
P/E Method
- EPS (TTM): ₹60
- Conservative multiple range: 30x–40x
- Fair
