Shipping Corp of India Shares Surge Over 12% on Strong Q2 FY25 Profits, Stake Sale Progress

Shipping Corporation of India (SCI) share price, India’s largest shipping company, soared by over 12% after the company reported a significant rise in profits for the September quarter. Investors also showed interest in SCI Land Assets, SCI’s newly demerged entity focused on real estate, which saw its shares rise by more than 6% on November 11.

Key Financial Highlights

SCI’s consolidated net profit rose substantially to ₹291.44 crore for the September quarter, compared to ₹65.73 crore in the same quarter last year. Revenue also increased to ₹1,491.23 crore, up from ₹1,161.89 crore a year ago. SCI announced a dividend of ₹0.50 per share for its shareholders.

Stock Performance

This recent rally has helped SCI shares regain much of their previous losses, bringing their year-to-date (YTD) performance to a 47% gain. SCI remains India’s largest shipping company and is the only domestic player involved in LNG transportation.

Progress on Strategic Divestment

SCI’s management provided updates on the ongoing strategic divestment, with qualified parties now conducting due diligence. The government anticipates that the sale will bring in approximately ₹3,000 crore. Maharashtra cabinet has granted a stamp duty exemption to facilitate SCI’s demerger, aiming to finalise the stake sale in 2024, with financial bids expected soon.

SCI’s Fleet and Market Outlook

The company’s fleet includes 59 vessels: 32 tankers, 15 bulk carriers, 2 liners, and 10 offshore supply vessels. SCI is optimistic about growth in the dry bulk segment through 2025, driven by high demand and limited vessel supply. However, freight rates are expected to decrease post-2025 as new vessel orders add to the overall supply in the market.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.