Mazagon Dock Shipbuilders · Material risks, their source context, and severity in the latest available quarter.
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Risk intelligence
INR 532 crore provisions taken for FPV Coast Guard and Denmark export contracts due to raw material and shipping cost escalation since bid submission in 2022-23. Further provisions may be required or reversed based on quarterly reassessment.
Current elevated margins (28.24% EBITDA, 27.2% PBT) reflect late-stage construction phase of 15 Bravo and P-75 Kalvari projects. As these complete, margins should decline toward 15% guided level.
Analyst questioned whether material costs are locked at contract inception for 4-5 year execution periods. Management confirmed bulk procurement happens early with supplier negotiations, but global shipbuilding boom has caused equipment pricing to exceed original bid assumptions.
AIP (Air Independent Propulsion) integration project for submarines faces delays due to DRDO deliverables. 42-month contract timeline extended, impacting revenue recognition schedule for this ₹4,000 crore vertical.
