Rs 222 Crore Order Book: Coal Mining Company Bags New Order of Rs 1,000.84 Lakh From Coal India Ltd
From Rs 97.30 (52-week low) to Rs 153 per share, the stock is up 57.25 per cent in less than 4 months.
South West Pinnacle Exploration Limited (SWPE) has secured a contract from Central Mine Planning and Design Institute Ltd. (CMPDI), a subsidiary of Coal India Limited, to conduct general coal exploration in Madhya Pradesh. The contract, valued at approximately Rs 1000.84 lakh (including GST), is expected to be completed within 360 days, including a 30-day mobilization period. SWPE will be required to provide a performance security deposit of 5 per cent of the contract value within 21 days.
Incorporated in 2006, South West Pinnacle Exploration Ltd (SWPEL) is a prominent player in the realm of drilling and exploration of coal, minerals and coal-bed methane. With an ISO 9001:2015 certification, SWPEL offers comprehensive services in mineral and unconventional energy resources. Their core operations encompass drilling, exploration and mining activities.
One of SWPEL's significant milestones is the award of a partially explored coal block in Jharkhand for commercial coal mining. The company has initiated development activities and aims to commence coal production by the end of FY 2026. To facilitate this, SWPEL plans to invest approximately Rs 200 crore in capital expenditure (capex) by FY26. This investment will be directed towards government agency payments, equipment acquisition land acquisition and infrastructure development. While funding for the capex is still under consideration, SWPEL is exploring various options including debt, follow-on public offers (FPOs), qualified institutional placements (QIPs), internal accruals and receipts from offtake agreements.
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In terms of regulatory approvals, SWPEL is actively engaged in obtaining necessary permissions from district and state authorities, including the process of obtaining a prospecting license (PL) cum mining lease (ML). The company anticipates submitting a geological report within the next 9-12 months, followed by the finalization of the mining plan. The estimated capex requirement for fiscal 2024 is projected to be between Rs 20-25 crore. As of March 31, 2023, it has an order book of Rs 222 crore.
The company has a market cap of over Rs 400 crore. From Rs 97.30 (52-week low) to Rs 153 per share, the stock is up 57.25 per cent in less than 4 months. Investors should keep an eye on this micro-cap stock.
Disclaimer: The article is for informational purposes only and not investment advice.
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