Small-cap cylinder stock trading below Rs 100 received LOA of project worth Rs 67,00,00,000 from BPCL; FII stake increased in Q2!
In FY23, company has allotted 2,00,00,000 Convertible Warrant at conversion rate 1:1 to promoter and others on preferential basis.
The company has received Letter of acceptance from Bharat Petroleum Corporation limited to supply 450 NO. OF CNG Type-I CNG MOBILE/STATIONARY CASCADES FOR BPCL CGD Projects worth of approximately Rs 67 crore.
The company name is - Confidence Enterprises Private Limited (100% subsidiary of Confidence Futuristic Energetech Limited, which is a subsidiary of Confidence Petroleum India Limited)
Confidence Petroleum India Ltd is engaged in manufacturing of LPG cylinders and is also a supplier of auto LPG in India with its network of bottling plants and Auto LPG dispensing stations across India. It also supplies packed LPG cylinders and is also engaged in LPG bottling catering to industrial and commercial customers.
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Clientele
Company supplies cylinders to well-known clients such as IOCL, HPCL, and BPCL. Other clients of the company include Tata, Kirloskar, Bajaj, Volvo, Haldirams, and others.
Promoter Shares Pledge
Promoters pledged 18 per cent of their ownership in September 2022 to obtain interim cash for LPG buying from overseas markets. As of December 23, 3 per cent of the shares were pledged.
Capex
Over the medium term, the group intends to invest capex of Rs 350 crore, of which approximately Rs 200 crore will be funded by bank loans and the remainder by the issuing of warrants, preferential allotment, and internal accruals. In FY23, the company made its largest-ever capital expenditure investment of Rs 212 crores.
Shift in Supply Chain
Because of the Russia-Ukraine crisis in H1FY23, the company had to satisfy its LPG Bulk need by direct import from the Middle East. This unexpected shift in the supply chain caused storage issues, so they purchased 500 LPG tankers, which increased their storage capacity but needed considerable investments. In addition, Co hired two ships to secure its supply.
Issue of Convertible Warrants
In FY23, company has allotted 2,00,00,000 Convertible Warrant at conversion rate 1:1 to promoter and others on preferential basis.
Disclaimer: The article is for informational purposes only and not investment advice.