At a Glance

Jindal Drilling & Industries just dropped its Q1 FY26 results, and it’s like watching a rig strike oil – profits bubbling, margins gushing, and investors sniffing that sweet crude cash. Revenue hit ₹254 Cr, up 48.6% YoY, while net profit came in at ₹66 Cr, a solid 50% jump. OPM? A jaw-dropping 42% – the kind of margin software companies dream about while drilling their losses. The stock trades at ₹636 with a modest P/E of 7.7, making it look cheaper than a barrel in a price war. But wait, promoter holding has slipped, and other income is doing some heavy lifting. Time to dig deeper.

Introduction

Picture this: a company that drills holes in the ocean floor for a living, but somehow manages to keep its financials less holey than most. Welcome to Jindal Drilling & Industries Ltd, where offshore rigs don’t just extract oil, they extract investor joy. While crude oil prices play their usual rollercoaster game, Jindal has quietly been stacking profits like a disciplined driller stacking pipes.

The company is part of the Dharam Pal Jindal Group, and unlike some of its peers who are still stuck in the mud (looking at you, Aban Offshore), Jindal has emerged as the steady hand in India’s offshore drilling segment. With directional drilling, mud logging, and measurement while drilling services in its arsenal, it’s basically the Avengers of oilfield support – minus the Hollywood budget.

But is this stock a hidden gem or a trap waiting to collapse like an abandoned well? Let’s grab our auditor’s helmet and headlamp – because we’re about to dig deep.

Business Model (WTF Do They Even Do?)

Jindal Drilling’s business model is as simple as it is risky: they drill offshore wells for oil and gas explorers. Think of them as the mercenaries of the oilfield – they don’t own the oil, but they get paid handsomely to poke holes in the seabed so someone else can.

Services offered:

• Offshore Drilling – The bread and butter. Mechanical process of drilling boreholes underwater. High margins if contracts are locked; high pain if rigs are idle.
• Directional & Horizontal Drilling – Fancy tech that lets them drill at multiple angles. Oil companies love it because it’s more efficient.
• Measurement While Drilling (MWD) – Real-time data collection. Sensors, transmitters, the works.
• Mud Logging – Sounds gross but is crucial. Analyzing rock cuttings to detect hydrocarbons.

The business is capital-intensive, cyclic, and heavily dependent on crude oil prices and E&P (Exploration & Production) activity. One bad oil crash, and suddenly rigs are rusting faster than investor hopes. But in good times? Cash gushes like an oil blowout.

Financials Overview

Grab your calculators, because Jindal’s Q1 FY26 numbers are spicier than a refinery fire:

• Revenue: ₹254 Cr (up 48.6% YoY)
• EBITDA: ₹107 Cr (Margin 42%)
• PAT: ₹66 Cr (up 50.7% YoY)
• EPS: ₹22.8 (TTM EPS ₹82.1)

For FY25, the company clocked ₹911 Cr in revenue with a PAT of ₹238 Cr – a near 100% jump over FY24. The OPM expanded to 34% from 29%, and PAT margins now flirt with 26%. Debt has reduced to ₹164 Cr, ROE is a healthy 14.6%, and ROCE sits at 16.4%.

But not all is sunshine and crude rainbows. Other income of ₹116 Cr is a big chunk of profits – always a red flag for sustainability.

Valuation

Now the fun part: fair value calculation.

1. P/E Method

Industry P/E: ~15x
TTM EPS: ₹82.1
Fair Value = 15 × 82.1 = ₹1,230

2. EV/EBITDA Method

EV/EBITDA multiple (industry): ~8x
FY25 EBITDA: ₹306 Cr
Debt: ₹164 Cr | Cash: negligible
EV = 8 × 306 = ₹2,448 Cr
Minus Debt → Equity Value = ₹2,284 Cr
Fair Value per share ≈ ₹790

3. DCF (Discounted Cash Flow)

Assume FCF growth 10% for 5 years, discount rate 12%, terminal growth 3%.
Intrinsic Value ≈ ₹850

Fair Value Range: ₹790 – ₹1,230
(Current price ₹636 looks like the market is still half asleep.)

What’s Cooking – News, Triggers, Drama

• Q1 FY26 results blew past expectations.
• Promoter stake dipped to 64.24% – why the exit? 🤔
• Offshore contracts pipeline strong; global oil demand stabilizing.
• Internal & secretarial auditors re-appointed (because paperwork is sexy).
• CRISIL ratings stable, no debt bombs hiding.

Balance Sheet

Auditor Joke: Assets doubled, liabilities behaved, borrowings shrank – even the auditor smiled, which is rarer than oil in a dry well.

Cash Flow – Sab Number Game Hai

Comment: Operating cash turned into a geyser in FY25. Investing CF is bleeding (rig upgrades), financing is manageable. Healthy.

Ratios – Sexy or Stressy?

Takeaway: Ratios are fitter than most gym bros. Low P/E, low debt, high margins – what’s not to love?

P&L Breakdown – Show Me the Money

Auditor Roasts: FY24 was a pothole, FY25 was a launchpad. If FY26 keeps this up, investors may start calling rigs their lucky charm.

Peer Comparison

Comment: Jindal is the most profitable and cheapest. Peers look like they’re drilling for excuses.

Miscellaneous – Shareholding, Promoters

• Promoters: 64.24% (down slightly, watch out)
• FIIs: 2.13% (creeping in)
• DIIs: 0.49%
• Public: 33.1%

Promoter bios? Industrial veterans with an obsession for rigs. Light sarcasm: they sell a bit, investors panic a lot.

EduInvesting Verdict™

Jindal Drilling has staged a remarkable comeback – from negative profits to a ₹238 Cr PAT and a 42% OPM in Q1 FY26. Debt is negligible, cash flow is gushing, and valuations are still low. The only irritants? Promoter stake slipping, heavy other income, and dependence on the ever-mood-swinging oil market.

SWOT Analysis

• Strengths: Low debt, high margins, strong order book.
• Weaknesses: Cyclical industry, reliance on other income.
• Opportunities: Rising offshore activity, global oil demand, potential new contracts.
• Threats: Oil price crash, contract delays, regulatory risks.

Final Word: At ₹636, this stock looks like an undervalued barrel of oil. But remember – offshore drilling is boom-bust. Strap in, enjoy the ride, and hope the rig doesn’t hit a dry patch.

Written by EduInvesting Team | 30 July 2025
SEO Tags: Jindal Drilling, Offshore Drilling Stocks, Oil & Gas Services, Q1 FY26 Results