Dredging Corp

This is a Miniratna  PSU engaged in the business of dredging and as expected, its major clients includes major ports and non ports, Indian navy, state Govts. The Govt holds 78.56% stake in the company and its performance for Q2FY13 has been good. It had a loss of Rs.7 crore in current Q1 and it turned around in Q2 with a net profit at Rs.13 crore, up 30% (YoY).  The company has YoY reduced its employee expense by 26% but its repair and maintenance charges rose by a whopping 480%  and the cost of fuel & lubricants rose 18%.

The company has a record of some volatile performance. In FY12, the company had a very small profit in Q1 and Q2 and in Q3, it posted a loss of Rs.29 crore and in Q4, it turned around with a net profit at Rs.30 crore. And now in current fiscal, Q1 was loss and Q2 was in profit. At end of H1FY13, net profit stands at Rs.6 crore v/s Rs.13 crore in FY12. Given the volatile nature of the business, one cannot say for certain that the company will be able to either surpass FY12 or maybe worse off than FY12. For now, the performance is good and the market also, living in the moment, seems to acknowledge this.