Deep Industries surge 38% in last three days after securing ONGC orders

New Delhi: After receiving two orders from Oil and Natural Gas Corporation (ONGC) worth Rs 184 crore, Deep Industries Ltd’s shares rose 20 percent to Rs 170 in early morning trade on Thursday, zooming 38 percent in past three trading days on the Bombay Stock Exchange (BSE). Revenue visibility would increase for the coming years with the mentioned orders.  The integrated oil and gas company’s stock has surged 115 percent following the past three days rise, against its 52-week low price of Rs 79 hit in July last year.    

It is trading at close to its 52-week high level of Rs 179 achieved in April last year on the BSE in intra-day trade.

The two ONGC orders include the deployment of two 1,000 HP drilling rig for the oil and gas explorer’s Ahmedabad Asset for three years. The said contracts are estimated to be valued at Rs 91.75 crore each, calculated at an exchange conversion rate equals to Rs 70 per 1 US$.

After bagging the two orders, the management said Indian oil‐gas firms have begun issuing orders following a long hiatus. Moreover, they feel this is a positive step for the industry and the company in particular.

 Positive revenue visibility for next 2 years

"This order inflow coupled with the company’s growing orderbook in the overseas oil‐gas services segment give good revenue visibility for the next couple of years," they said.

Deep Industries is a major services provider in the oil and gas and coal bed methane (CBM) sectors. It has business interests in the areas of natural gas dehydration, natural gas compression, integrated project management services and drilling rigs services.