A summary of the Deep Industries opportunity
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Order book of 1082 cr. executable in about ~2.5 years. Annual run rate of roughly 400 cr. At roughly, 25% PAT margins, would mean about 100 cr. of PAT per year. Further there is good bullishness on the sector for energy self sufficiency.
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Dolphin acquisition (Acquired for 27 cr. under IBC.) to start contributing from mid of FY24 (6-9 months as per Q3 call). At it’s peak Dolphin had about 400 cr. revenue rate with 30% EBITDA margins. Hopefully by FY25 they would be able to reach 1/4th of the peak revenue rate!!? Mgmt. is hopeful to cross Dolphin’s past numbers, but for obvious reasons not ready to comment on a timeline at this point.
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RAAS compressors contribution is negligible, so ignoring it for now.
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Has won an arbitration award of 108 cr. from ONGC and expect 75% of that from ONGC anytime now. ONGC has gone to challenge this award in higher forum.
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Net cash of about 60 cr. in hand.
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Market cap = 852 cr. , EV~800 cr. Trailing 12 month PAT of 78 cr. could get to about 85 cr. PAT in FY23.
Appears like a decent bargain given the growth prospects ?
Disc: Invested from lower levels.