Jindal Drilling And Industries Limited — Investor Meet, 04-02-2025: Analysts/Institutional Investor Meet/Con. Call Updates

**Financial Performance:** Jindal Drilling & Industries reported a robust performance in Q3 FY25, with revenues soaring 39% to INR 254 crores compared to the previous quarter. EBITDA rose significantly from INR 31 crores to INR 81 crores, while PAT jumped from INR 16 crores to INR 49 crores, leading to an EPS increase from INR 5 to INR 17. The improvement in earnings was largely driven by the deployment of the Jindal Supreme rig with ONGC in October 2024.

**Future Outlook and Growth Drivers:** Management is optimistic about future earnings growth, particularly following the pending acquisition of the Jindal Pioneer rig, which is expected to enhance profitability. The company aims to leverage its strong relationship with ONGC, having supported them over 30 years, to further expand service offerings and increase market share.

**Order Book and Operational Updates:** The company’s current order book stands at INR 1,636 crores. Insight into its future pipeline indicates potential enhancements in revenues tied to the performance of newly deployed rigs and anticipated contract renewals. All deployed rigs are expected to generate higher rates, contributing to a healthier financial outlook.

**Analyst Q&A Insights:**

- **Revenue and Profitability:** Analysts sought clarification on revenue expectations post-acquisition and future PAT run rates. Management indicated that PAT could rise significantly with the completion of the Jindal Pioneer deal.

- **Market Position:** Inquiries about competitive positioning revealed management's strategy focused on long-term contracts with ONGC, ensuring a stable revenue stream.

- **Operational Risks:** Analysts expressed concerns regarding potential contract renegotiation and operational challenges. Management confirmed that securing ONGC contracts remains critical, though they remain confident in maintaining existing contracts.

- **Capital Allocation:** Questions about capex plans highlighted a current focus on the Jindal Pioneer acquisition, with future consolidation of owned rigs contributing to operational efficiencies.

- **Strategic Long-term Vision:** Management reiterated their commitment to enhancing asset value and operational margins, while focusing on strengthening core service competencies.

**Market or Regulatory Updates:** ONGC's recent announcements regarding increased capital expenditures could provide a constructive backdrop for Jindal, enhancing overall sector dynamics.

**Strategic Focus Areas:** The company emphasizes operational efficiency and consolidation of assets as key themes, alongside maintaining strong relationships with clients to navigate sector volatility.

**Investor Insight:** With strong financial metrics and a strategic focus on rig acquisitions, Jindal Drilling appears to be well-positioned for growth. The anticipated boost from the Jindal Pioneer acquisition, paired with a favorable market environment, suggests a positive outlook, aligning with a potential ‘buy’ position for investors seeking exposure in the offshore drilling sector.