GRSE: Rs 32,000 Crore Navy Order - 4.6 Times FY26 Revenue

GRSE Garden Reach Shipbuilders and Engineers is a defence public sector shipyard that builds warships, patrol vessels and specialised research ships for the Indian Navy and Coast Guard. It has delivered 118 warships and operates four shipbuilding facilities in Kolkata. Its FY26 order book stood at Rs 15,324 crore. What happened: On 2 November 2026, GRSE secured a Rs 32,000 crore contract for five next-generation corvettes for the Indian Navy, running nine years and four months from first-stage payment. This is 4.6 times FY26 annual revenue. For FY26, revenue grew 38% year on year to Rs 7,002 crore and net profit rose 42% to Rs 748 crore. ROCE was 42.8% and ROE was 31.6%. Q2FY27 results are due on 11 November 2026. Why it matters: This contract more than doubles GRSE’s June 2026 backlog of Rs 13,596 crore. Revenue recognition begins in FY28, with design and equipment procurement as the first phase. GRSE also holds export orders for 12 multipurpose vessels from a German client and is expanding simultaneous capacity from 28 to 32 vessels by December 2026. What I am watching: Corvette revenue begins in FY28, so near-term results depend on existing project execution. Two new yard investments, Rs 2,200 crore at Raichak and Rs 2,000 crore on the western coast, add capex ahead of that revenue. My stance: GRSE trades at 18.7 times EV/EBITDA, above its 5-year median of 16.3 times but well below the peer median of 42.5 times. The order win is transformational in scale. Execution over a nine-year contract with complex procurement schedules, working capital management and margin discipline will determine how much of that Rs 32,000 crore order value eventually flows through to profit. I do not hold a position in GRSE at the time of writing. This is not investment advice.