South West Pinnacle Exploration Stock Soars After Securing ₹10 Cr Solar Project
Shares of South West Pinnacle Exploration experienced a notable surge, climbing as much as 3%, after the company announced that it has been awarded two significant Letters of Intimation (LOI) for solar pumping system installations.
Market Reaction and Current Trading
With a market capitalization of ₹384.08 crore, the company's stock was trading at ₹137.65, marking an increase of approximately 8% compared to the previous closing price of ₹136.35. This positive market movement reflects investor confidence following the project announcement.
Details of the New Project
The company's stock saw a bullish trend after receiving the LOIs from M/s Odisha Lift Irrigation Corporation Limited. These projects involve the installation of deep bore wells for a Solar Pumping System in Odisha, collectively valued at approximately ₹10.86 Crores, including GST.
Financial Overview
In terms of financial performance, the company’s revenue increased by 17%, from ₹23.27 crore in Q2FY24 to ₹27.35 crore in Q2FY25. However, during the same period, net profit decreased by 68%, from ₹0.97 crore to ₹0.31 crore.
Company Services
South West Pinnacle Exploration offers various services, including aquifer mapping, CBM exploration, mining, coal and mineral drilling, geological and geophysical services, 2D/3D seismic exploration, and workover rig services. These services support resource extraction and energy production.
Extensive Clientele
The company’s clientele includes Oil India, CMPDI, Central Ground Water Board, Directorate of Geology, Dept. of Mines, SAIL, NMDC, Odisha Lift Irrigation Corporation, Odisha Mineral Corporation, Mineral Exploration Corporation, Geological Survey of India, Hindustan Zinc, JSW Steel, ArcelorMittal, Vedanta, Reliance, and Hindalco.
Future Capex Plans
The company plans to start production at a coal block in Jharkhand by FY26, with a capital expenditure of ₹200 crore allocated for approvals, equipment, land, and infrastructure. The FY24 capex is estimated at ₹20-25 crore, to be funded through debt, FPO, QIP, or internal accruals.
International Ventures
The company operates two rigs in Oman and has a joint venture, Alara Resources LLC, with Alara Oman Operations and Al Tasnim. This JV has secured an 11-year, $125 million copper mining contract, outsourced to Al Tasnim.
Key Financial Ratios
Analyzing key ratios, the return on equity decreased from 7.88% in FY22-23 to 6.80% in FY23-24, and the return on capital employed decreased from 12.80% to 11.59%. The net profit margin for FY23-24 is 5.34%.
Shareholding Structure
The shareholding pattern shows that the company's Promoters hold 73.61% of the shares, while Retail shareholders hold 26.02% and Foreign Institutional Investors own 0.36%.
About South West Pinnacle Exploration Limited
South West Pinnacle Exploration Limited is an India-based exploration services company. It is involved in providing drilling, exploration, and allied services to the mining and energy industries.
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