Garden Reach Sh.

Garden Reach Shipbuilders & Engineers Ltd. delivered a strong Q3 FY26, with revenue from operations increasing by 49% year-on-year to ₹1,896 crores, up from ₹1,271 crores in Q3 FY25. Profit After Tax (PAT) also saw significant growth, rising 74% year-on-year to ₹171 crores from ₹98 crores in the prior year. For the nine months ended December 31, 2025, the company reported revenue of ₹4,883 crores, nearly matching its full FY25 revenue of ₹5,076 crores, indicating an accelerated execution pace. Management expects to achieve a revenue CAGR of 25-30% for the current financial year.

As of December 31, 2025, GRSE's order book stands at ₹18,482 crores, with the defense segment contributing 77% (₹14,276 crores), including ₹8,236 crores for P-17 Alpha frigates. The company has a robust pipeline of potential orders, including the recently won Next-Generation Corvette project worth ₹33,000 crores, and AON-accorded projects like P-17 Bravo (₹70,000 crores), LPD (₹35,000 crores), and Mine Counter Measure Vessels (₹32,000 crores), totaling ₹1,55,000 crores over the next 12 months. Additionally, the non-defense segment presents opportunities exceeding ₹1 lakh crores, with two tenders and one EOI currently live.

GRSE is actively expanding its production capacity, aiming to increase concurrent platforms from 24 to 32 by the end of the current calendar year and to 35 by the end of 2026. This includes brownfield expansion at three sites acquired from Syama Prasad Mookerjee Port, with two sites expected to commence production by year-end. The company is also pursuing greenfield expansion with two sites in Gujarat (Kandla and Bhavnagar), projected to be production-ready in three years and capable of building 12 large ships of 300-meter length. Investments in advanced automation, such as robotic welding and plasma cutting machines, are ongoing to enhance efficiency.

To address capacity constraints and pursue larger projects, GRSE has formed strategic partnerships. An MoU with Swan Defence targets bidding and executing large commercial vessels (>250m), with an order expected in the next financial year. A consortium agreement with Hindustan Shipyard (HSL) enables GRSE to bid for the LPD project, leveraging HSL's infrastructure. The company maintains a strong focus on indigenization, achieving over 85% indigenous content in completed projects and actively participating in government schemes (Make-I, Make-II, Make-III) to further localize critical components like propulsion and weapon systems.

GRSE has demonstrated strong project execution, delivering five major platforms in the first nine months of FY26 and planning to deliver three more in the next three months. The second P-17 Alpha ship is 93% complete and due for delivery in the next three months, while the third is on track for delivery this calendar year. The Next-Generation Corvette project is expected to commence revenue accrual from Q4 FY28, with equipment orders to be placed within six months of contract signing. Management projects FY27 to be a peak revenue year and aims to strategically manage projects and spares to avoid a revenue plateau in FY28.