Cochin Shipyard shares climb pausing 4-day losing run; what's next?

Shares of defence PSU Cochin Shipyard Ltd settled higher on Friday, halting their four-day downward run. Today's uptick followed news of Israel launching a series of military strikes on Iran, sparking concerns over a wider geopolitical conflict and boosting investor demand for defence-related shares.

The stock rose 1.44 per cent to close at Rs 2,160.50. At this price, it has gained 36.98 per cent in a month. Bourses BSE and NSE have put the securities of Cochin Shipyard under the long-term ASM (Additional Surveillance Measure) framework. Exchanges put stocks in short-term or long-term ASM frameworks to caution investors about high volatility in share prices.

A few analysts suggest buying the stock on dips with a long-term view due to strong earnings visibility and order book.

"We have seen some profit booking in the last few sessions. The company's earnings visibility looks good, given its strong order book. Investors with a long-term view can consider buying it on dips," said Kranthi Bathini, Director of Equity Strategy at WealthMills Securities.

The stock could rise to an upside target of Rs 2,650 level, said Ravi Singh, Senior Vice-President of Retail Research at Religare Broking. He advised placing a stop loss at Rs 2,280.

The scrip traded lower than the 5-day and 10-day simple moving averages (SMAs) but higher than the 20-day, 30-, 50-, 100-, 150-day and 200-day SMAs. Its 14-day relative strength index (RSI) came at 60.83. A level below 30 is defined as oversold while a value above 70 is considered overbought.

The company's stock has a price-to-earnings (P/E) ratio of 69.07 against a price-to-book (P/B) value of 10.70. Earnings per share (EPS) stood at 31.28 with a return on equity (RoE) of 15.48. According to Trendlyne data, Cochin has a one-year beta of 1.4, indicating high volatility.

The state-run defence company has recently joined hands with Drydocks World to enhance its ship repair and offshore fabrication capabilities. This collaboration is aimed at establishing a world-class ship repair ecosystem catering to both domestic and international fleets.

As of March 2025, the government held a 67.91 per cent stake in the state-run firm.