Cochin Shipyard plans to Rs 500 crore IPO

Public sector Cochin Shipyard is eyeing capital markets to raise Rs 400-500 crore through IPO for its expansion plans, a top official on Friday said.

"We are starting the process. We are looking to raise about Rs 400-500 crore through IPO," Cochin Shipyard chairman and managing director Commodore K Subramaniam told reporters here.

The proposal is yet to be finalised and the yard has tentatively planned to offer 2.22 crore shares, he added.

The total investment for the expansion plans is Rs 1,500 crore. To sustain growth of ship repair and shipbuilding in the future, it is essential that investment is made for capacity augmentation for which a new large dry dock at the existing Cochin Shipyard estate capable of docking offshore oil rigs, semi submersibles etc is needed, he said.

There are also plans to develop a world class ship repair facility at Cochin Port and take up offshore fabrication work for ONGC and other operators at a dedicated offshore location.

The yard has already taken over the land and workshop facilities on lease from Cochin port for setting up of an International Ship repair Facility in their premises with shiplift system at a cost of Rs 487 crore.

On Cochin Shipyard's performance, he said the turnover for  2012-13 was Rs 1,554 crore against Rs 1,405 crore in 2011-12. Profit Before Tax and net profit were Rs 276 crore and Rs 185 crore in 2012-13 as compared to Rs 253 crore and Rs 172 crore in 2011-12.

The yard's order book as of Friday is 25 ships comprising 20 Fast Patrol Vessels, three Offshore Support ships for Indian and foreign owners, one Buoy Tender vessel for the Department of Lighthouses and Lightships, besides the Aircraft carrier for the Indian Navy.