Mazagon Dock Shipbuilders Limited (MAZDOCK) is a leading shipbuilding company in India, primarily engaged in the construction of warships and submarines for the Indian Navy.
The company has a strong track record and has consistently delivered impressive financial performance over the years.
Let’s delve into the returns an investor would have earned if they had invested ₹10,000 in MAZDOCK five years ago.
Investment Value and Growth
Suppose an investor had purchased shares of MAZDOCK on October 16, 2020, at the price of ₹168.05 per share. With an initial investment of ₹10,000, they would have been able to buy approximately 59 shares (₹10,000 / ₹168.05 = 59.51 shares, rounded down to 59).
Fast forward to June 4, 2024, when the MAZDOCK share price stands at ₹2,729.90. The value of the investment made five years ago would be:
59 shares × ₹2,729.90 per share = ₹1,61,064.10
This means that the initial investment of ₹10,000 has grown to a staggering ₹1,61,064.10, representing an impressive growth of over 16 times the initial investment.
Dividends and Total Returns
MAZDOCK has a consistent track record of paying dividends to its shareholders, further enhancing the overall returns.
Based on the dividend history provided, let’s calculate the total dividends received over the past five years:
- Year 1 (2020-21): ₹10.77 per share (Interim ₹5.41 + Final ₹1.83 + Interim ₹3.53)
- Year 2 (2021-22): ₹8.73 per share (Interim ₹7.10 + Final ₹1.63)
- Year 3 (2022-23): ₹15.96 per share (Interim ₹9.10 + Final ₹6.86)
- Year 4 (2023-24): ₹22.20 per share (Interim ₹15.34 + Final ₹6.86 assumed based on previous year)
Total dividends received = (59 shares × ₹10.77) + (59 shares × ₹8.73) + (59 shares × ₹15.96) + (59 shares × ₹22.20)
= ₹3,387.43
Adding the dividends received to the current value of the investment, the total returns would be:
Total Returns = Current Value of Investment + Total Dividends Received
= ₹1,61,064.10 + ₹3,387.43
= ₹1,64,451.53
This means that if an investor had invested ₹10,000 in MAZDOCK five years ago, their total returns, including capital appreciation and dividends, would have amounted to a remarkable ₹1,64,451.53, representing an impressive growth of over 16 times the initial investment.
MAZDOCK Investment Calculator
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Financial Performance and Growth Drivers
MAZDOCK’s strong financial performance and growth can be attributed to several factors, which are evident from the provided financial data:
- Revenue Growth: MAZDOCK’s revenue from operations has shown a consistent upward trend over the past five years, indicating strong order book execution and robust demand for its shipbuilding services.
- Profitability: The company has maintained healthy profit margins, with a net profit margin ranging from 8.32% to 19.49% over the past five years. This reflects efficient cost management and operational excellence.
- Return on Equity (ROE): MAZDOCK’s ROE has consistently been above 15%, peaking at 33.12% in the latest fiscal year, indicating efficient capital utilization and strong returns for shareholders.
- Dividend Payout: The company has a commendable dividend payout ratio, ranging from 27.24% to 53.16% of its net profits over the past five years, demonstrating its commitment to rewarding shareholders.
- Strong Balance Sheet: MAZDOCK has a robust balance sheet with zero debt and substantial cash reserves, providing financial flexibility and resilience.
- Order Book: The company’s order book position remains strong, with a healthy pipeline of orders from the Indian Navy, ensuring visibility of future revenue and profitability.
Key Takeaways
The analysis highlights the remarkable returns an investor could have achieved by investing in MAZDOCK five years ago. Here are the key takeaways:
- An initial investment of ₹10,000 in MAZDOCK on October 16, 2020, would have grown to ₹1,64,451.53 by June 4, 2024, including capital appreciation and dividends.
- The investment would have yielded a staggering growth of over 16 times the initial investment in just five years.
- MAZDOCK’s strong financial performance, revenue growth, profitability, efficient capital utilization, and consistent dividend payouts have been the driving forces behind this impressive growth.
- The company’s robust order book and strong financials provide a solid foundation for future growth and returns for investors.
While past performance is not a guarantee of future results, MAZDOCK’s track record and growth prospects make it an attractive investment opportunity for investors seeking long-term capital appreciation and consistent dividend income.