GRSE margin contracts by 3 per cent in December quarter

Defence PSU Garden Reach Shipbuilders & Engineers Limited (GRSE) has said that its margin shrank by three per cent in the third quarter of the current fiscal with declining revenue. Revenue from operations for the December quarter was at Rs 369.63 crore, as compared to Rs 488.59 crore in the same period of previous year.

The shipbuilder's EBITDA margin was at 12 per cent in the October-December period of 2019-20 as against 15 per cent in the corresponding period of the last fiscal, the company said in a statement. However, the margin in the April-December period of the current fiscal rose by 3 per cent to 16 per cent.

The company is currently executing six projects with construction of 19 ships. Of these projects, five are for the Indian Navy and one for the Indian Coast Guard.

As on December 2019, the company's order book stood at Rs 27,047 crore and of this, the value of shipbuilding was Rs 26,732 crore. Shipbuilding is a highly-complex process and its construction activities involve a long gestation period, the company said.

With this nature of business of warship construction, year-on-year performance is considered relevant than quarter- on-quarter earnings, it added..