New Delhi: Shares of public sector Mazagon Dock Shipbuilders and Garden Reach Shipbuilders and Engineers Limited (GRSE) have given charismatic returns in the last few months. The stock of Mazagon Dock was close to Rs 200 in 2022, but reached an all-time high of Rs 5,860 in July this year. Similarly, the stock of GRSE was also hovering around Rs 200 in 2020. It also made an all-time high of Rs 2,833.80 in July. But now the shares of both these companies are falling sharply.

Reasons for fall in Mazagon Dock, GRSE shares

Last week, domestic brokerage ICICI Securities had released a report in which Mazagon Dock and GRSE were given a 'Sell' rating. In its report dated August 16, it had predicted a decline of about 70 percent in both the companies. After that, in two consecutive trading sessions, the shares of Mazagon Dock and GRSE have fallen by 12 percent and 7.4 percent respectively.

ICICI Securities has given a target price of Rs 1,165 for Mazagon Dock, which indicates a potential downside of 77 per cent. On the other hand, the brokerage has given a target price of Rs 515 for GRSE. According to this, it will decline by 74 per cent.

What do Mazagon Dock and GRSE do

Mazagon Dock Shipbuilders and GRSE provide ships and related services, like Cochin Shipyard. They build warships and submarines for the Navy. They also manufacture ships for offshore oil drilling. The companies have reported good quarterly results and have healthy orders. But ICICI Securities believes that they will face a lot of delay in completing their orders and there will be problems due to the Bangladesh crisis.