The shares of this micro-cap oil stock engaged in manufacturing Casing, Tubing, and Drill Pipe in India surged 8 percent after the company reported a 2,100 percent year-on-year increase in revenue and net profit growth in its recently released quarterly results.
Share Price Movement
The share price of Oil Country Tubular Ltd opened at Rs. 59.59 hit a 5 percent upper circuit and touched a day’s high of Rs.59.59 per share on Tuesday’s intraday trade from its previous close of Rs.56.76 per share. However, the shares are locked at the upper circuit limit.
What Happened
The stock movement was due to an earnings update which was released by the company. The company posted a significant increase in revenues and a jump in net profits in Q2FY25.
According to its recent filing, In Q2FY25, Oil Country Tubular Ltd reported a 2100 percent increase in revenue to Rs.22 crore in Q2FY25, compared to Rs.1 crore in Q2FY24. Furthermore, quarterly, the company saw a decrease of 12 percent in revenue from Rs.25 crore in Q1FY25.
In the same period, the company reported an improvement in net losses to Rs. 13 crore in Q2FY25, from Rs.15 crore in Q2FY24, and a slight increase in losses from Rs.10 crore in Q1FY25.
The company’s current ratio of 0.31 and its debt-to-equity ratio was 0.49 as of FY24. Enterprise value to sales stood at 5.24.
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Revenue Segment
The company earns its revenue from segments like Drill Pipe and allied products – 37.49 percent, OCTG Services – 63.51 percent in Q2FY25. The Other sales and services had contributed around 96 percent of the revenue same quarter a year before. In this quarter, OCTG services form a major share of revenue in the recent quarter.
Shareholding Pattern
As of September 2024, the shareholding pattern includes promoters holding a share of 49.22 percent stake in Oil Country tubular, Foreign Institutional Investors (FII) holding around 0.01 percent, Domestic Institutional investors (DII) standing at 0.11 percent, and public holdings standing at 50.65 percent.
About the company
Oil Country Tubular Limited is a manufacturer of Oil Country Tubular Goods which is based in Hyderabad, India. The company was established in 1985, OCTL specializes in producing essential drilling products such as tubing, casing, and drill pipes for the oil and gas industry. The company operates under certain API certifications which ensures high-quality standards.
Their business model focuses on manufacturing and processing a diverse range of OCTG products while providing related services like reconditioning and inspection, catering to both domestic and international markets to meet the growing demand in the energy sector. The order book as of FY24 stood at Rs. 85 crore which includes Job work order value worth Rs. 50 crore and Rs. 35 crore from ONGC and export orders and expect they plan to achieve a turnover of Rs. 100 crore in FY25.
Written by – Santhosh S
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