Deep Industries Set for Rebound After Securing ₹83.81 Crore LOA from ONGC for Gas Compression Services

Deep Industries Set for Rebound After Securing ₹83.81 Crore LOA from ONGC for Gas Compression Services​

Deep Industries is poised to break its losing streak after receiving a significant Letter of Award (LoA) from Oil and Natural Gas Corporation (ONGC). The domestic contract, valued at approximately ₹83.81 crore, pertains to charter hiring services for gas compression at the Lakmani GGS-5 asset in Assam. This substantial contract is set to be executed over a three-year period.

##Securing Key Contracts Drives Investor Sentiment

The latest LoA significantly bolsters Deep Industries' project pipeline and operational strength. Prior to this, the company had secured another important LoA in April. That April agreement involved hiring services for Natural Gas Compressor, Gas Dehydration, and HC Dew Point Depression at ONGC’s Rajamundry Asset for a duration of three years, valued at Rs 59 crore.

Furthermore, Deep Industries expanded its reach into the renewable sector. In March, the company executed a Memorandum of Understanding (MOU) with Advait Greenergy (AGPL). This MOU focuses on executing various tenders and contracts related to Green Hydrogen projects across India and internationally from government bodies, PSUs, or private entities.

##Historical Stock Performance and Market Standing

The company's stock movement has shown volatility following recent contract wins. In the preceding trading session, Deep Industries shares closed at Rs 486.40, marking a decline of Rs 6.00 or 1.22 percent. This performance follows strong market reactions in earlier months. Shares had surged 12.7 percent during April and rallied 24 percent in March.

The stock currently holds a market capitalization of Rs 3,112.96 crore. Despite recent declines, the company remains significantly above its lowest recorded valuation. The share is trading 48.81 percent above its 52-week low.

##52-Week Range and Valuation Context

Deep Industries has seen fluctuations within its market cycle. Its 52-week high was recorded at Rs 578.00. Conversely, the stock touched its 52-week low of Rs 326.85 during specific trading periods. It is currently trading 15.85 percent below its peak performance level.

The acquisition of contracts from major PSUs like ONGC underscores the company's specialized operational capabilities in the energy sector. The continuous flow of agreements, including those relating to future green hydrogen initiatives, provides a strong fundamental backing for the stock.