Mumbai: Mazagon Dock Shipbuilders Ltd, the state-owned defence shipbuilder that plans to make an initial public offering (IPO) later this month, is in talks with countries in Africa and South-East Asia for its first defence exports, top executives at the company said.

The company, which operates a shipbuilding and submarine-building yard in Mumbai, also plans to begin a ship repair vertical as a steady revenue stream.

In August, capital markets regulator Securities and Exchange Board of India gave the go-ahead to the dockyard’s plans to float its stock in the public markets. As part of the central government’s disinvestment target, the company plans to raise 750-850 crore from its IPO. The proceeds of the share sale will go entirely to the government and no fresh capital will be raised.

“We are in advanced talks with a few countries—their delegates were here this week—to provide defence exports to them," said Captain Rajiv Lath (Retd), director (submarine and heavy engineering) at Mazagon Dock. The firm is in talks with the navy to refit and repair existing assets, he said.

The company is also exploring the possibility of developing a greenfield shipyard at Nhava, Navi Mumbai, with a ship lift, wet basin, workshops, stores and buildings, and a ship repair facility spread over 40 acres. Lath declined to mention the size of the investment required to build this facility.

Mazagon Docks reported revenue of 4,286 crore at the end of March 2017 and net profit of 595.6 crore in the same period. The company has an order book of 52,000 crore for building 4 P-15B destroyers, 4 P-17A stealth frigates and 5 Scorpene class submarines for the navy.

Yes Securities (India) Ltd, Axis Capital Ltd, Edelweiss Financial Services Ltd, IDFC Bank Ltd and JM Financial Ltd are the bankers to the issue.

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