The two companies have launched a collaboration model to build commercial vessels in three premier shipyards of DEMPO at Goa and Bhavnagar.

This is GRSE's maiden attempt to diversify in a big way in commercial shipbuilding to capture a large market share in construction of commercial vessels, both domestic as well as international.

GRSE had taken the maiden initiative in the country to make the public-private collaboration model a success story in warship building. Aligning this concept with the emerging commercial shipbuilding market, GRSE is now partnering with V S Dempo Holdings to share their shipbuilding resources with GRSE to build commercial vessels on the west coast.

According to a research, India's shipbuilding market is estimated to be $7.1 billion in 2023 and is expected to reach $8.76 billion in 2028. The global shipbuilding market on the other hand is estimated to grow from $170 billion to $230 billion by 2028 at a CAGR of 5.45%.

A report also stated that India's contribution to commercial shipbuilding globally is less than 1% today which is far lower than 3.5 % achieved during 2007. It also stated that even with the subsidy the private shipyards are not competitive and state owned shipyards are content to available defence orders.

GRSE took the onus of breaking this glass ceiling and actively engaged itself to use its technology and resources to compete with countries like China, Vietnam and Turkey – the low-cost shipbuilders to win contracts from European, Middle Eastern and African markets.

Commodore P R Hari, chairman & managing director, GRSE, brought out that in spite of challenges there is a positive outlook in the global commercial shipbuilding sector. The rise of Chinese competition in recent years and stricter environmental regulations are making it difficult for the Indian shipbuilders to meet the global demand.

However, he assured that the shipbuilding and repair industry is undergoing rapid technological change which is creating new opportunities for companies that can keep up with the latest trends. To avail the business opportunity of growing demand in commercial vessel sector, GRSE has identified a suitable partner for progressing with commercial shipbuilding.

He explained that most of the export clients are from Europe and Middle East. The shipyards of the DEMPO group give a positional advantage to these clients for shifting the delivered vessels from India in comparison to China, Vietnam and Turkey.

State-run GRSE is engaged in building warships and other vessels for the Indian Navy and Indian Coast Guard. It has also diversified into engineering business with a product profile of pre-fabricated steel bridges, various deck machinery items and assembly, as well as testing & overhauling of marine diesel engines. The Government of India holds 74.50% in the company.

The company's net profit had risen by 52.81% to Rs 76.68 crore on 30.38% increase in net sales to Rs 755.90 crore in Q1 June 2023 over Q1 June 2022.

The scrip had advanced 0.55% to end at Rs 789.20 on the BSE.