Stock Report

Welspun Corp Ltd's associate company to cancel order with Aramco

Posted On : 2024-03-22 22:15:18( TIMEZONE : IST )

Welspun Corp Limited's associate company East Pipes Integrated Company for Industry (EPIC), Saudi Arabia's leading manufacturer of HSAW Pipes announced the mutual agreement with Aramco to stop and cancel an SAR 153 million (Approx. Rs 339 crore) contract. It is important to highlight here that this development has no impact on EPIC due to the following reasons:

- The contract was not included in the EPIC's production schedules during the current fiscal year;

- According to the EPIC's plans, the raw materials related to the contract have not been purchased yet;

- The cancellation does not affect the operating plans during the period scheduled for implementation.

EPIC's substantial order backlog is mainly linked to ongoing gas and water transmission projects. The abovementioned contract represents 6% of the total awards by Saudi Aramco, valued at SAR 2.7 billion (Approx. Rs 6,000 crore), and just 3% of the total value of contracts announced during the current fiscal year (FY2023-2024), which amounts to nearly SAR 4.4 billion (Approx. Rs 9,800 crore). We are quite optimistic about the future prospects of our associate company EPIC, which are further supported by Aramco's diversification of its energy mix, as well as the increasing demand for water transmission lines to support initiatives aimed at increasing water reserves across the Kingdom of Saudi Arabia, as well as other projects and programs such as NEOM, Green Riyadh Project, and other targeted projects. Moreover, the strategic alignment of the business objectives with the government's policies and initiatives, will continue to drive the growth going forward and help unlock additional opportunities.

Shares of Welspun Corp Limited was last trading in BSE at Rs. 535.95 as compared to the previous close of Rs. 524.35. The total number of shares traded during the day was 92407 in over 1477 trades.

The stock hit an intraday high of Rs. 544.90 and intraday low of 516.05. The net turnover during the day was Rs. 49715777.00.