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Choppy stock market conditions have forced the government to put off the planned share-sale in India’s biggest warship builder Mazagon Dock Shipbuilders.
The initial public offering of shares in Mazagon Dock was slated to hit the market after the share-sale in Garden Reach Shipbuilders and Engineers (GRSE) in September.
Both Mazagon and GRSE are defence public sector undertakings operating under the administrative control of the Defence ministry.
The GRSE share-sale was hit by a market slide, forcing the government to extend the sale period and reduce the price band. Eventually, the IPO was bailed out by some state-run banks who bought bulk of the shares on offer.
“There is no time-line now for the Mazagon Dock IPO,” said a banker involved in the exercise. “It was postponed after the GRSE fiasco. When the market condition improves, we will take a call at that time.”
India’s only shipyard to build destroyers and conventional submarines for the Navy was expected to be a big draw among investors looking to benefit from the government-funded naval shipbuilding programme estimated worth thousands of crores.
The yard currently has orders for building four ‘P-15B’ destroyers, four ‘P-17A’ stealth frigates and five Scorpene class submarines for the Indian Navy, valued at a combined ₹₹52,760.8 crore.
Mazagon has also entered the submarine repair business by clinching a ₹1,100-crore refit deal from the Indian Navy to overhaul its Shishumar Class non-nuclear diesel electric submarine named INS Shishumar.
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