Mumbai: Mazagaon Dock Shipbuilders reached another milestone as the first submarine Kalvari being constructed at the shipyard was separated from the pontoon and set afloat at the naval dockyard Mumbai./File
Mumbai: Mazagaon Dock Shipbuilders reached another milestone as the first submarine Kalvari being constructed at the shipyard was separated from the pontoon and set afloat at the naval dockyard Mumbai./File
Photo by BL SONI

COVID-19 pandemic did have an impact on Mazagon Dock Shipbuilders (MDL). The hit came in the form of shortage in manpower, stated a top official of MDL.

Speaking at the press briefing of the IPO launch, an MDL official said, “COVID-19 had an impact. The whole of Mumbai was under lockdown for three months. There were no buses and trains. Now, it is a partial lockdown and around 50-60 per cent manpower has come back.”

While MDL employees could resume work, it was the manpower of the subcontractor that took a hit, during the lockdown, revealed MDL Chairman and Managing Director Narayan Prasad. However, he is optimistic that MDL’s manpower issue will stabilise within two months.

Adding to it, MDL Director for Finance and Chief Financial Officer, Sanjeev Singhal denied the possibility of cost overruns due to the COVID-19 crisis.

Joint Secretary in the Ministry of Finance, Alok Pande, said that while the impact of COVID-19 was limited in some sectors, industries like airlines and hospitality were hit hard.

In terms of finances, MDL does not see an impact of COVID-19 mainly because the projects are usually long-term and the timeline can be adjusted accordingly. Singhal said, “We are maintaining our timelines," he added.

However, in the last quarter, the impact of COVID-19 led to a loss of Rs 12 crore.

State-owned defence firm MDL is going for an initial public offering (IPO) on September 29 — after a yearlong wait. It will close for subscription on October 1.

The price band for the issue is Rs 135-145 per equity share. Commenting on pricing, Pande said the government was conscious of the after-market performance also, adding that the pricing has tried to strike a balance between value maximisation for the government and also for the investors.

The initial public offer is for 3,05,99,017 shares through an offer for sale (OFS). The issue will close for subscription on October 1.

MDL is expected to raise around Rs 444 crore with the IPO. MDL, which received the 'Miniratna' status in 2006, is the only shipyard to have built destroyers and conventional submarines for the Indian Navy.

With an order book to the tune of Rs 54,0470 crore, it is also one of the first shipyards to manufacture Corvettes (small warships) in the country.

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