Garden Reach Shipbuilders & Engineers Ltd.
NSE: GRSEGarden Reach Shipbuilders & Engineers Ltd.: A 30-second snapshot
Garden Reach Shipbuilders & Engineers (GRSE) is a defence-sector PSU engaged in naval shipbuilding, trading at ₹2,685.90 with a trailing PE of 44.7x and forward PE of 29.3x. Revenue has compounded at 29.1% and earnings at 24.2% over 5 years, while ROE of 31.79% is the highest among available Infrastructure peers. Free cash flow has been positive in only 1 of the historical years tracked, and the stock sits 23.56% below its 52-week high despite a 41.26% 1-year gain.
P/E
44.7
Forward P/E
29.3
ROE
+31.8%
Debt / Equity
1.42
Profit Margin
+10.7%
Div. Yield
+1.0%
5Y ROE > 15%
4/5
5Y FCF > 0
1/5
Quality
60/100
News
8 headlines · 4 positive · 0 negative
GRSE Q4 FY26 Results: Net Profit Up 24%, Conference Call Set for May 8 - scanx.trade
scanx.trade
GRSE share price target raised! What Antique says on Garden Reach's Q4 surprise - Business Today
Business Today
GRSE Q4 results: PAT jumps 24% YoY to Rs 303 crore on 29% revenue uptick; recommends Rs 6.70/share dividen - The Economic Times
The Economic Times
Garden Reach Shipbuilders & Engineers Limited Discloses Substantial Shareholding Under SEBI Regulations - scanx.trade
scanx.trade
If EPS Growth Is Important To You, Garden Reach Shipbuilders & Engineers (NSE:GRSE) Presents An Opportunity - simplywall.st
simplywall.st
Recent context
- ·Q4 FY26 results (April 28, 2026): PAT up 24% YoY and revenue up 29% YoY; Antique raised its price target following what was described as a quarterly surprise, per Business Today (April 29, 2026).
- ·GRSE disclosed substantial shareholding changes under SEBI regulations (April 29, 2026), a routine filing but one that signals active institutional activity around the stock.
- ·SimplyWallSt noted (May 16, 2026) the company as presenting an EPS growth profile for investors focused on earnings expansion — noting the 5-year earnings trajectory context.
Strengths
- +5-year revenue CAGR of 29.1% and earnings CAGR of 24.2% reflect sustained order-book execution in the domestic defence shipbuilding segment.
- +ROE of 31.79% ranks 1st of 6 among Infrastructure peers with available data, above L&T (16.95%) and CG Power (19.56%).
- +Q4 FY26 PAT grew 24% YoY to ₹303 crore on 29% revenue growth, with a ₹6.70/share dividend recommended — the most recent quarterly result was ahead of recent trend.
- +Trailing PE of 44.7x compresses to a forward PE of 29.3x, implying analysts modelling meaningful near-term earnings expansion; GRSE trades at a discount to ABB (86.8x), CG Power (108.5x), and Cummins (66.5x) on trailing basis.
Weaknesses
- −Free cash flow was positive in only 1 of the historical years available; persistent negative FCF in a capital-intensive business raises questions about cash conversion quality of reported earnings.
- −Debt-to-equity stands at 1.424 with a flat trend; continued capex requirements for shipbuilding execution may sustain leverage without a clear deleveraging path.
- −ROE above-15% record covers only 4 of available historical years, and FCF consistency score of 78 alongside a single FCF-positive year signals uneven quality of earnings persistence.
- −Quality composite score of 43 ranks 4th of 6 Infrastructure peers — below BEL (57), Cummins (24 ranks 6th but ABB at 47 and CG Power at 45 rank above GRSE) — the FCF weakness is the primary drag on composite positioning.
Open questions
- ?Does the persistent negative FCF reflect the timing of milestone-based contract receipts in naval shipbuilding, or does it indicate structural working-capital challenges in the business model?
- ?How much of GRSE revenue is dependent on Indian Navy orders versus export contracts, and what is the order-book duration and execution visibility?
- ?With a forward PE of 29.3x versus trailing 44.7x, what earnings growth rate is embedded in the current price, and how sensitive is the valuation to execution delays on the existing order book?
- ?Given that debt-to-equity is 1.424 with a flat trend, how does GRSE fund the capex required for capacity expansion — through internal accruals, debt, or equity dilution — and what are the implications for future ROE sustainability?
Peer comparison: Infrastructure
Ranks 4 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| GRSE | Garden Reach Shipbuilders & Engineers Ltd.You're viewing | 44.7 | +31.8% | 43 |
| Industry avg | across 5 peers | 69.4 | +18.3% | 40 |
| BEL | Bharat Electronics Ltd. | 51.9 | — | 57 |
| ABB | ABB India Ltd. | 86.8 | — | 47 |
| CGPOWER | CG Power and Industrial Solutions Ltd. | 108.5 | +19.6% | 45 |
| LT | Larsen & Toubro Ltd. | 33.4 | +16.9% | 26 |
| CUMMINSIND | Cummins India Ltd. | 66.5 | — | 24 |
Technical state
Current price
₹2,685.90
SMA 50
₹2,570.02
SMA 200
₹2,539.62
RSI (14)
46.3 (neutral)
From 52w high
-23.6%
1Y return
+41.3%
3M return
+8.2%
50-DMA
Above
200-DMA
Above
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- highFree cash flow was positive in only 1 of the 5 available historical years; in a capital-intensive defence shipbuilding business, persistent negative FCF raises questions about whether reported earnings translate into cash returns.
- mediumDebt-to-equity of 1.424 with a flat debt trend; ongoing order-book execution in shipbuilding typically requires continued capex, which may sustain leverage at current levels.
- mediumPrice of ₹2,685.90 is 5.5% above SMA200 (₹2,539.62) and 4.5% above SMA50 (₹2,570.02); however the stock is 23.56% below its 52-week high, indicating the prior run-up has partially unwound.
- lowAnalyst coverage is thin at 4 analysts; mean rating of 2.5 on a 1–5 scale (lower = more constructive) provides limited research breadth for gauging institutional conviction.
- lowQuality score of 43 ranks 4th of 6 Infrastructure peers despite GRSE carrying the highest ROE (31.79%) among peers with available data — the composite quality methodology likely penalises the weak FCF record.
Cross-section contradictions
- ROE of 31.79% is the highest among ranked peers with available data, yet free cash flow was positive in only 1 of the historical years available — high accounting return on equity has not translated to commensurate cash generation.
- Stock gained 41.26% over 12 months and sits above both moving averages, yet trades 23.56% below its 52-week high — recent momentum has reversed meaningfully from peak levels despite continued positive earnings news.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 24 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 17 May 2026 · rotates through NIFTY 500 every ~5 days