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Informist, Tuesday, Oct. 28, 2025

By Afra Abubacker and Sagar Sen

NEW DELHI – Mazagon Dock Shipbuilders Ltd. said it hopes to soon sign a contract with the government for additional submarines in the coming months as commercial negotiations with the defence ministry have been completed. The company also expects to be well-positioned to secure several large upcoming naval orders. 

"For the additional submarines of P75, the commercial negotiations with the Ministry of Defence were completed a few months ago, and the project was just at the sanction stage. But beyond that, we have not been kept informed," the management said in a post-earnings conference call. It hopes to sign the contract for "the three additional Scorpene submarines," it added.

Under Project 75, the company has already delivered six Scorpene-class submarines to the Indian Navy earlier this year. It now expects to "immediately commence" execution of the additional order once the contract is signed, as the project will be a continuation of the same submarine series. However, it noted that projects under P75(I) will have a one-year "preparatory period", work on which the company has already begun, the management said. 

Projects under P75 (India) are a follow-up to the existing P75 programme. The company said it is in advanced negotiations with the government and expects to sign the contract for P75(I) by the current financial year end. "We anticipate (that for) P75I, where the negotiations are ongoing, we should be able to sign the contract before the financial year ending," it said. 

The company said the Indian Navy is expected to come up with multiple expansion projects--the landing platform dock costing INR 350 billion-INR 400 billion, the Mine Counter Measure Vessels around INR 400 billion, 17 Bravo frigates with INR 500 billion-INR 600 billion, and destroyer-class projects estimated at INR 700 billion-INR 800 billion. "So overall, the expansion of the Navy is considerable and we anticipate that we are ideally placed to win a sizable part of that order," the company said.

Asked about other orders, the company said it has the capacity to build 11 submarines simultaneously. "Even with three additional Scorpene submarines and six P75(I), we will have spare capacity," the company said. Mazagon is currently building around 27 vessels for the coast guard and export clients. 

The company's total order book stood at INR 274.15 billion as of Sept. 30, with orders of INR 171.14 billion in its shipbuilding vertical and orders worth INR 100.89 billion in its submarine and heavy engineering vertical, according to the investor presentation. 

Mazagon also expects to secure "short-cycle projects" from state-owned companies such as the Oil and Natural Gas Corporation Ltd., Indian Oil Corp. Ltd., and Shipping Corp. of India. 

On the proposed acquisition of Colombo Dockyard Ltd., the company said, "The acquisition is still not complete, and we are still not the shareholders of that company." However, with the rights issue expected by this month-end, the company expects to be a shareholder next month and get into the business of commercial shipbuilding and ship repair. 

The company added that the cash outgo for the acquisition will depend on the rights issue and mandatory offer by the existing shareholders. The company expects to hold a 51-75% stake, but if it's a complete ownership, then the investment could be around INR 4.5 billion, the management said. 

For FY26, the company has planned a capital expenditure of INR 5 billion, largely to upgrade its infrastructure at the Nhava Yard and South Yard annex in Mumbai. Over the next five years, it plans to invest INR 50 billion to set up a greenfield shipyard at Tuticorin, Tamil Nadu, for commercial shipbuilding. 

The company announced its September quarter earnings late Monday, with its consolidated net profit rising 28% on year to INR 7.49 billion and its top line growing 6% to INR 29.29 billion. On Tuesday, shares of the company closed 1% lower at INR 2,780.4 on the National Stock Exchange. End

Edited by Akul Nishant Akhoury

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