SCI, GRSE, Cochin Shipyard, Mazagon Dock rise up to 5% as govt approves infra status to large ships

SCI, GRSE, Cochin Shipyard, Mazagon Dock rise up to 5% as govt approves infra status to large ships

Shares of shipbuilder companies rose up to 5% on September 22 as government approved infrastructure status to large ships.

The government accorded the infrastructure status to “large ships" on September 19, which comes seven months after Finance Minister Nirmala Sitharaman announced it in her Budget speech.

On September 19, the department of economic affairs notified a modification to the harmonised master list of infrastructure sectors.

“‘Large ships’ are included in the harmonised master list of infrastructure sub-sectors by insertion of a new item in the category of ‘Transport and Logistics’,” the finance ministry’s gazette notification stated.

On September 22 at 10:30 am, shares of Shipping Corporation of India were trading 5% higher at Rs 230.5 apiece while those of Garden Reach Shipbuilders & Engineers Ltd were also trading 5% higher at Rs 2,734 apiece.

SCI shares also rallied because the firm signed MoU with BPCL, HPCL and IOC to jointly acquire, own and manage vessels.

Cochin Shipyard Ltd stock was trading 2.5% higher at Rs 1,948.5 while the stock of Mazagon Dock was trading 1.3% higher at Rs 3,023.6.

On September 22, Nifty India Defence index was trading 0.26% higher at Rs 8,340.

Additionally, Prime Minister Narendra Modi has announced three schemes with government investment of over Rs 70,000 crore to boost the shipbuilding sector. This is to provide incentives, interest subsidies, and long-term finance to boost domestic shipbuilding, ship-breaking and port-linked infrastructure, the report said.

The package will have four components, including the Shipbuilding Financial Assistance Scheme to provide Rs 25,000 crore financial aid to shipbuilders, Rs 25,000 crore to set up a Maritime Development Fund, and Rs 20,000 crore for capacity creation for developing greenfield clusters and expansion of existing hubs.