Shares of Cochin Shipyard Ltd
gained over 1.5% on the BSE in the morning trade.
Cochin Shipyard Ltd (CSL) has entered into an Agreement with the Andaman and Nicobar Administration to commence its operations at Marine Dockyard, at Port Blair, a facility that is currently being operated directly by the A&N Administration. Under the ambit of this Agreement signed on November 28, 2019, CSL shall assist the Administration to set up a Ship repair ecosystem at A&N islands, shall associate in Augmentation and Modernisation of the facility and shall also focus efforts towards Skill Development in the Islands in consultation with the Administration and Technical Institutions located in the Islands.
CSL will be entitled to a management fee of Rs15cr per annum. A profit share of 7.5% of PAT shall be payable by CSL to the Administration for profit generated by CSL through providing Ship Repair Services at the Marine Dockyard facility.
CSL shall assist the Administration in the preparation of DPR for Augmentation and Modernisation of the facility for which the Company would charge 3% of the project cost (as per approved DPR). CSL has also offered to provide procurement services on a Cost Plus Mark-Up basis, in case the Administration so desires.
Cochin Shipyard Ltd is currently trading at Rs407.25, up by Rs6.15 or 1.53% from its previous closing of Rs401.10 on the BSE.
The scrip opened at Rs400 and has touched a high and low of Rs408.80 and Rs400 respectively.