It’s common for many investors, especially those who are inexperienced, to buy shares in companies with a good story even if these companies are loss-making. But the reality is that when a company loses money each year, for long enough, its investors will usually take their share of those losses. Loss-making companies are always racing against time to reach financial sustainability, so investors in these companies may be taking on more risk than they should.
Despite being in the age of tech-stock blue-sky investing, many investors still adopt a more traditional strategy; buying shares in profitable companies like Garden Reach Shipbuilders & Engineers (NSE:GRSE). While this doesn’t necessarily speak to whether it’s undervalued, the profitability of the business is enough to warrant some appreciation – especially if its growing.
We’ve found 21 US stocks that are forecast to pay a dividend yield of over 6% next year. See the full list for free.
How Quickly Is Garden Reach Shipbuilders & Engineers Increasing Earnings Per Share?
The market is a voting machine in the short term, but a weighing machine in the long term, so you’d expect share price to follow earnings per share (EPS) outcomes eventually. Therefore, there are plenty of investors who like to buy shares in companies that are growing EPS. Shareholders will be happy to know that Garden Reach Shipbuilders & Engineers’ EPS has grown 37% each year, compound, over three years. So it’s not surprising to see the company trades on a very high multiple of (past) earnings.
It’s often helpful to take a look at earnings before interest and tax (EBIT) margins, as well as revenue growth, to get another take on the quality of the company’s growth. The good news is that Garden Reach Shipbuilders & Engineers is growing revenues, and EBIT margins improved by 2.8 percentage points to 8.1%, over the last year. Ticking those two boxes is a good sign of growth, in our book.
You can take a look at the company’s revenue and earnings growth trend, in the chart below. Click on the chart to see the exact numbers.
NSEI:GRSE Earnings and Revenue History October 18th 2025
View our latest analysis for Garden Reach Shipbuilders & Engineers
Fortunately, we’ve got access to analyst forecasts of Garden Reach Shipbuilders & Engineers’ future profits. You can do your own forecasts without looking, or you can take a peek at what the professionals are predicting.
Are Garden Reach Shipbuilders & Engineers Insiders Aligned With All Shareholders?
It’s a necessity that company leaders act in the best interest of shareholders and so insider investment always comes as a reassurance to the market. So it is good to see that Garden Reach Shipbuilders & Engineers insiders have a significant amount of capital invested in the stock. To be specific, they have ₹3.2b worth of shares. That shows significant buy-in, and may indicate conviction in the business strategy. While their ownership only accounts for 1.1%, this is still a considerable amount at stake to encourage the business to maintain a strategy that will deliver value to shareholders.
While it’s always good to see some strong conviction in the company from insiders through heavy investment, it’s also important for shareholders to ask if management compensation policies are reasonable. Well, based on the CEO pay, you’d argue that they are indeed. For companies with market capitalisations between ₹176b and ₹564b, like Garden Reach Shipbuilders & Engineers, the median CEO pay is around ₹59m.
The Garden Reach Shipbuilders & Engineers CEO received total compensation of just ₹7.8m in the year to March 2025. First impressions seem to indicate a compensation policy that is favourable to shareholders. CEO compensation is hardly the most important aspect of a company to consider, but when it’s reasonable, that gives a little more confidence that leadership are looking out for shareholder interests. It can also be a sign of good governance, more generally.
Is Garden Reach Shipbuilders & Engineers Worth Keeping An Eye On?
You can’t deny that Garden Reach Shipbuilders & Engineers has grown its earnings per share at a very impressive rate. That’s attractive. If that’s not enough, consider also that the CEO pay is quite reasonable, and insiders are well-invested alongside other shareholders. The overarching message here is that Garden Reach Shipbuilders & Engineers has underlying strengths that make it worth a look at. It is worth noting though that we have found 1 warning sign for Garden Reach Shipbuilders & Engineers that you need to take into consideration.
There’s always the possibility of doing well buying stocks that are not growing earnings and do not have insiders buying shares. But for those who consider these important metrics, we encourage you to check out companies that do have those features. You can access a tailored list of Indian companies which have demonstrated growth backed by significant insider holdings.
Please note the insider transactions discussed in this article refer to reportable transactions in the relevant jurisdiction.
New: Manage All Your Stock Portfolios in One Place
We’ve created the ultimate portfolio companion for stock investors, and it’s free.
• Connect an unlimited number of Portfolios and see your total in one currency
• Be alerted to new Warning Signs or Risks via email or mobile
• Track the Fair Value of your stocks
Try a Demo Portfolio for Free
Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.
This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Comments are closed.