Multibagger Mazagon Dock shares have turned negative in 2024; can they recover?

Shares of multibagger defence stock Mazagon Dock Shipbuilders Ltd have turned negative this year. Mazagon Dock share price has fallen 6% in 2024. On the other hand, the stock zoomed 202% in a year and gained 742% in two years. Mazagon Dock stock rose 2.05% to Rs 2191 amid correction in the broader market today. Total 0.23 lakh shares of the firm changed hands amounting to a turnover of Rs 4.84 crore. Market cap of Mazagon Dock rose to Rs 43,434 crore on BSE.

Mazagon Dock shares have a one-year beta of 0.2, indicating very low volatility during the period. In terms of technicals, the relative strength index (RSI) of Mazagon Dock  stands at 43.6, signaling it's trading neither in the overbought nor in the oversold zone. Mazagon Dock shares are trading lower than the 5 day, 10 day, 20 day, 30 day, 50 day and higher than the 100 day, 150 day and 200 day moving averages.

HDFC Securities has a buy call on the Mazagon Dock stock with a target of Rs 2,525. 

"Investors can buy in the Rs 2,100-2,142 band and add more on dips to Rs 1900-1934 band (20.5x Sept’25E EPS). Base case fair value of the stock is Rs 2,338 (25x Sept’25E EPS) and the bull case fair value of the stock is Rs 2525 (27x Sept’25E EPS) over the next two to three quarters," said the brokerage.

Shiju Koothupalakkal - Technical Research Analyst, Prabhudas Lilladher said, "The stock after witnessing a strong bull run till September 2023, thereafter, has been moving within a range finding resistance near Rs 2490 zone. Currently with consolidation witnessed for the last 2 weeks, hovering around the 50EMA level of Rs 2195 zone, it needs a decisive breach above Rs 2260 level to confirm a breakout and thereafter, expect for further rise with initial target of Rs 2,365 and Rs 2,480 levels visible. The near-term support would be maintained near Rs 2,080 zone."

Antique Broking has a target of Rs 2,774 on the Mazagon Dock stock.

Abhijeet from Tips2Trades said, "Mazagon Dock stock price is  bearish with strong resistance now at Rs 2467 on the Daily charts. A Daily close below support of Rs 2022 could lead to target of Rs 1749 in the near term."

The defence firm reported its Q3 earnings on February 12. Net profit surged 77% to Rs 626.8 crore in the December 2023 quarter against Rs 354 crore in the corresponding quarter of previous year.

Revenue from operations rose 30% on-year to Rs 2,362.5 crore as against Rs 1,815.9 crore in the corresponding period of last year.

EBITDA or operating profit climbed 82% on-year to Rs 539 crore in the December quarter, while margins improved to 22.8%.

About the company

Mazagon Dock Shipbuilders Ltd (MDS) is a shipbuilding and offshore fabrication yard. The company's major activities include shipbuilding, ship repairs and fabrication of offshore structures. It provides warships, merchant ships, submarines, support vessels, offshore platforms, passenger cum cargo vessels, trawlers, main and helidecks and barges.

Disclaimer: Business Today provides stock market news for informational purposes only and that should not be construed as an investment advice. Readers are encouraged to consult with a qualified financial advisor before making any investment decisions.

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