Shares of small-cap company Oswal Pumps witnessed a sharp uptick during intraday trading on Wednesday, December 24, following a significant order win from a state utility. The stock climbed almost 4% on the BSE after the firm announced it had been empanelled for a major solar pumping project in Maharashtra.
Details of the Major Contract Win
In a regulatory filing submitted to the exchanges on December 24, Oswal Pumps informed investors that it had received a letter of empanelment from the Maharashtra State Electricity Distribution Company Limited (MSEDCL). The project involves the supply, installation, and maintenance of 6,500 off-grid DC solar photovoltaic water pumping systems (SPWPS).
This order falls under the central government's PM KUSUM-B scheme, specifically the "Magel Tyala Saur Krishi Pump" Yojana in Maharashtra. The company stated that the total approximate value of this project is ₹180 crore. The letter of empanelment is valid for a period of one year, within which the project must be executed.
Scope of Work and Technical Specifications
The comprehensive contract mandates Oswal Pumps to handle the design, manufacture, supply, transport, installation, testing, and commissioning of the solar pumping systems. The pumps will be of 3HP, 5 HP, and 7.5 HP capacity and will be installed at identified farmers' sites across districts in Maharashtra.
Key terms of the agreement include providing a complete system warranty, repair and maintenance services, and a remote monitoring system for a duration of five years. This integrated approach ensures long-term functionality and support for the agricultural beneficiaries.
Market Reaction and Share Price Trend
The market responded positively to the news. Oswal Pumps' share price opened at ₹532.40 on the BSE, compared to its previous close of ₹530.75. It then jumped 3.6% to hit an intraday high of ₹549.80.
The company made its stock market debut earlier this year, on June 20. It was listed at ₹634 on the NSE, a modest premium of 3.2% over its issue price of ₹614. On the BSE, it listed at ₹632. Despite the recent positive movement, the stock has faced pressure in the preceding months. It is down 2% month-to-date in December, following a significant 24% decline in November.
This substantial order from a state government undertaking is a strong validation of Oswal Pumps' capabilities in the renewable energy and agricultural infrastructure space. It provides significant revenue visibility and aligns with India's push for solar-powered sustainable agriculture under the PM-KUSUM scheme. Investors will now watch the company's execution timeline closely over the coming year.
