Gujarat Penny Stock Surges 20% After ONGC Contract Win

Gujarat Penny Stock Surges 20% After ONGC Contract Win

Aakash Exploration rallies after securing ₹19.36 crore order from ONGC

Gujarat-based micro-cap company *Aakash Exploration Services Ltd* saw a sharp rise in its share price, hitting the *20% upper circuit limit* after announcing a fresh order from *Oil and Natural Gas Corporation (ONGC)* worth ₹19.36 crore. This boost in stock price came as the market reacted positively to the company’s expanding portfolio of public sector projects, especially in oilfield services.

The company revealed that it had received a Letter of Intent (LOI) from ONGC to provide *mobile boiler and high-pressure steam services*. This contract adds to its growing track record of securing service-based orders from major oil and gas public sector enterprises (PSEs). Over the past few years, Aakash has built a solid presence in this niche space, successfully winning contracts exceeding ₹175 crore through competitive bidding. Its tender success rate, currently hovering around 57%, reflects its operational competence and consistent delivery.

The market responded swiftly. Following the order announcement, the stock—traditionally priced under ₹15—hit the *20% upper circuit* in intraday trading. A similar price movement was seen back in April when Aakash had secured a ₹29 crore contract from Oil India, which also triggered a strong rally. Prior to this surge, the stock was trading in the ₹7–₹9 range, and it has now approached ₹11 levels, with a 52-week low of ₹7.30 and a high of ₹17.15 recorded in July 2024.

Aakash Exploration is known for offering a range of oilfield services including *workover rigs, steam injection systems, pumping units*, and other critical equipment to India’s major oil producers like ONGC, Oil India, Indian Oil Corporation, and Vedanta. The company’s strength lies in its niche offerings, focused largely on upstream operations. Despite being a relatively small player, it has managed to consistently win sizable orders, thanks to its technical capabilities and cost-effective solutions.

Financially, Aakash remains a modest-sized firm. It has a market capitalization of around ₹80–85 crore and the promoter group holds approximately 66.6% of the company’s equity. Its recent quarterly revenue stands at ₹23–24 crore, while net profit was reported at ₹26 lakh for Q4 FY2024. While the earnings are not yet substantial, the company operates with a lean structure and continues to build a steady order book. Key financial ratios show a P/E of around 15–16 and a price-to-book value near 1.3. Its asset base is close to ₹87 crore, with net debt standing at roughly ₹25 crore.

For investors, this recent rally might present both opportunity and caution. The stock’s price action signals growing momentum among short-term traders and retail investors following news-based triggers. However, its long-term viability still depends on sustained contract wins, improved profit margins, and better scalability. Given that its revenues heavily rely on government and PSU orders, the company remains somewhat exposed to fluctuations in tendering cycles and contract renewals.

In summary, *Aakash Exploration Services Ltd* has demonstrated that even small-cap companies can generate significant market excitement when backed by meaningful contract wins. Its recent ₹19.36 crore order from ONGC not only validates its operational reliability but also boosts investor sentiment in the short term. Though the financials remain conservative, the consistent flow of PSU orders adds stability to its growth outlook.

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