Shares of this micro-cap stock associated with the ‘mining’ industry hit the 5 percent upper circuit in Tuesday’s trading session after the company successfully received an order from the “ Department of Water Resources”, Faridabad worth approximately Rs 54.81 crores (excluding GST).
With a market capitalization of Rs 300 crores, the stocks of South West Pinnacle Exploration Limited opened their trading session on Tuesday at Rs 102.70 and are currently locked in the 5 percent upper circuit at Rs 108.05.
Such sharp movements in the company’s stock were witnessed after the company, through a regulatory filing with the Bombay Stock Exchange (BSE), intimated that it has received a work order from the “Central Ground Water Board, Department of Water Resources”, Faridabad worth approximately Rs 54.81 crores (excluding GST).
The abovementioned order pertains to the construction of Piezometers in soft rock/hard rock as well as for the supply, installation, and commissioning of DWLRs and telemetry, data acquisition, etc in the states of Maharashtra and Gujrat.
The order also involves a warranty period of five years along with an Annual Maintenance Contract (AMC) period of two years. The time period for the execution of the work order is decided to be approximately 21 months.
During the recent financial quarters, the company reported an increase in its prime indicators of business such as operating revenues and net profits. The former shifted up marginally from Rs 23.27 crores during Q2FY24 to Rs 42.15 crores during Q3FY24, and, the latter, keeping the timeframe the same, rose sharply from Rs 97 lakhs to Rs 3.59 crores.
Due to underperformance on an annual basis in the company’s profitability, the return on equity (RoE) reduced from 10.40 percent during FY21-22 to 7.88 percent during FY22-23 and the return on capital employed (RoCE), during the same period, moved down from 16.08 percent to 12.80 percent.
As per the latest shareholding pattern for the December 2023 quarter, the company’s Promoters hold a 74.68 percent stake, and the Public (retail) Investors hold a 25.24 percent stake in the company.
Incorporated in 2006, South West Pinnacle Exploration Limited is engaged in providing drilling, exploration, and other associated services to various industries including coal, ferrous, nonferrous, atomic & base metal mining, and unconventional energy. The company also provides seismic exploration, aquifer mapping, and other services.
Written by Amit Madnani
Disclaimer
Shares of this micro-cap stock associated with the ‘mining’ industry hit the 5 percent upper circuit in Tuesday’s trading session after the company successfully received an order from the “ Department of Water Resources”, Faridabad worth approximately Rs 54.81 crores (excluding GST).
