Stock jumps 14% after receiving coal block exploration approval from Ministry of Coal

Synopsis:
South West Pinnacle Exploration jumped sharply after​‍​‌‍​‍‌​‍​‌‍​‍‌ the company was given government approval to investigate its own coal blocks in Jharkhand. The approval by the government agency gives the company the green light to start the actual work of drilling and conducting surveys in a short time.

The shares of this business, engaged in the business of drilling and exploration of coal, minerals and coal-bed methane, are in focus after it secured a key approval from the government that can significantly impact its business. In this article, we will dive more into the details.

With a market capitalisation of Rs 675 crore, the shares of South West Pinnacle Exploration (SWPE) Ltd reached a day high of Rs 242.55 per share, up by over 14 percent from its previous day’s closing price of Rs 211.85 per share. Over the past five years, the stock has delivered a robust return of 548 percent, outperforming NIFTY 50’s return of 98 percent

About the Accreditation

South​‍​‌‍​‍‌​‍​‌‍​‍‌ West Pinnacle, through a stock exchange filing, announced that it has been granted official authorisation by the Government of India to be the approved agency for coal exploration. This notification is valid for a period of three years.

The company is thus permitted to initiate operations in its coal blocks in Jharkhand, which comprises activities like drilling, conducting surveys, and preparing mining plans. (Accreditation refers to a situation where the government, after a thorough review, recognises and allows a company to perform a certain job).

After getting this green light, the firm is in a position to start the job at a much quicker pace since it is no longer necessary to wait for the agency to come from outside. To this end, South West Pinnacle has already begun the process of relocating its equipment and workforce to the site. This is a milestone for the firm and is anticipated to accelerate the implementation of its coal ​‍​‌‍​‍‌​‍​‌‍​‍‌project.

Financial and Other Highlights

South West reported a revenue growth of 128 percent on a YoY basis from Rs 27.36 crore in Q2FY25 to Rs 62.44 crore in Q2FY26. Additionally, on a QoQ basis, revenue zoomed by 55 percent from Rs 40.22 crore in Q1FY26 to Rs 62.44 crore in Q2FY26.

Moreover, net profit increased by 1,990 percent on a YoY basis from Rs 0.40 crore in Q2FY25 to Rs 8.36 crore in Q2FY26; meanwhile, on a QoQ basis, net profit jumped by 248 percent from just Rs 2.40 crore in Q1FY26 to Rs 8.36 crore in Q2FY26.

During the quarter, SWPE formed a new JV in Oman, Al Hdeetha Mining LLC, which, after obtaining a mining block, started the exploration. Besides, under a Rs 1.53 billion Reliance contract, the company initiated phase two of CBM production, won a Rs 153 million JSW Energy project, and got total fresh Q2 orders of more than Rs 85 crore, thereby increasing its order book to Rs 4.12 ​‍​‌‍​‍‌​‍​‌‍​‍‌billion.

South West Pinnacle Exploration is an Integrated Service Provider, delivering the whole drilling & exploration process of natural resources, i.e. Coal, Ferrous, Non-Ferrous, and Atomic Minerals, as well as Conventional & non-conventional Oil & Gas and groundwater investigation. Moreover, SWPEL is proficient in the use of advanced technology for exploratory research, such as surface geographical investigation, downhole geophysics, 2D/3D Seismic, and Passive Seismic Tomography, ​‍​‌‍​‍‌​‍​‌‍​‍‌etc.

Written by Satyajeet Mukherjee

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