On September 9, 2024, the company’s shares soared by 17.02% to an unprecedented Rs 465.35 each. This significant uptick follows the announcement of a major order valued at Rs 1,402 crore from the Oil and Natural Gas Corporation (ONGC). If you’re looking to invest in stocks, this is a notable opportunity in the market.
Major contract win propels stock price
The remarkable rise in Deep Industries' share price comes after the company revealed a substantial contract win. Deep Industries, an established player in providing integrated solutions for oil and gas operations, has secured a Rs 1,402 crore deal with ONGC. This contract, which will last 15 years, focuses on Production Enhancement Operations (PEC) at ONGC’s Rajahmundry Asset.
PEC contracts are crucial for extending the life of mature and depleted oil fields. They are designed to enhance hydrocarbon production, applying advanced techniques to boost recovery and maintain production levels. At Rajahmundry, ONGC plans to improve hydrocarbon reserves through safe and efficient practices, employing the latest technology to increase production and overall recovery.
A transformative deal for Deep Industries
This new order is the largest ever awarded to Deep Industries, more than doubling the company's previous order book. As of June 30, 2024, the company's order book was Rs 1,246 crore. This landmark achievement not only strengthens Deep Industries' position in the industry but also significantly boosts its revenue potential.
Paras Savla, Managing Director of Deep Industries, expressed excitement about this strategic victory. He noted that this deal positions the company to play a more critical role in the oil and gas services sector. With over three decades of experience, Deep Industries is well-prepared to deliver on the PEC framework, which not only diversifies its revenue streams but also enhances profitability.
Deep Industries’ strong service portfolio
Deep Industries has been a key provider of oil and gas support services for more than 30 years. Their service offerings include Natural Gas Compression, Dehydration, Workover and Drilling Rigs, and Integrated Project Management. The company is known for its comprehensive range of equipment and skilled personnel, which ensures high standards of quality and safety across its services.
Since its beginnings in the 1990s, Deep Industries has evolved from offering charter hire gas compression services to providing a full suite of services, including Gas Processing Facilities on charter hire. They have become pioneers in this niche, offering unique services that set them apart from competitors.
Key takeaways
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