Target: ₹690
CMP: ₹580.60
Deep Industries operates nine workover rigs, with plans to add two more, and five drilling rigs, with one additional rig set for deployment. This segment contributes 33 per cent of revenue with margins of 40 per cent and a market share of 25 per cent. Its natural gas compression services, commanding a 90 per cent market share, contribute 37 per cent of revenue with 60 per cent margins, and are expected to grow at a 15 per cent CAGR.
The natural gas dehydration segment adds 10 per cent of revenue at 55 per cent margins. A new natural gas processing service, set up at a cost of ₹75-80 crore, offers bundled solutions and is projected to generate ₹4 crore in monthly revenue. Integrated project management services contribute 10-15 per cent of revenue with 30 per cent margins, positioning Deep Industries as the sole Indian player in this segment.
Deep Industries’ expansion strategy, including its addition of new rigs, the barge asset “Prabha,” and a natural gas processing service, positions the company for sustained growth. The company’s ability to dominate key segments such as natural gas compression and integrated project management services, sets it apart in a competitive landscape. Additionally, its recent ₹1,402 crore ONGC contract and strong order book, coupled with promising growth from its bidding pipeline, should drive revenue growth.
