Deep Industries Forecasts Robust Growth

Ashwin Thakker

16 Aug 2025 — 2 min read

Key Facts:

Sales Outlook: Expects over 30% year-on-year revenue growth for at least the next 2-3 years.
Margin Outlook: Aims to maintain 40-45% EBITDA margins, with overall improvement projected.
Dolphin Business: Anticipates approximately INR 100 crore annual revenue from its main contract, with 60%+ margins.
PEC Contract (Rajahmundry): Expected to contribute approximately INR 140 crore in full-year revenue from FY27, with partial contribution in FY26.
Strategic Capex: Planning INR 350-400 crore for Dolphin fleet expansion and INR 160 crore for Production Enhancement Contract (PEC) assets.

Deep Industries Limited announced a compelling Q1 FY26 performance, registering a robust 61.6% year-on-year revenue surge. The recent earnings call illuminated the company's strategic vision and an optimistic outlook for the future. Bolstered by burgeoning demand in India's oil and gas sector, the company has outlined a clear roadmap focusing on sustained growth, enhanced profitability, and strategic investments, positioning it strongly for the coming years.

Revenue Momentum and Strategic Expansion

The company projects over 30% year-on-year revenue growth for the next 2-3 years, backed by a strong INR 3,051 crore order book. Chairman and MD, Paras Savla, cited a “very positive financial outlook,” with Rohan Shah stating:

“We are expecting growth... more than 30%... for at least next 2 to 3 years.”

The Dolphin business expects INR 100 crore in annual revenue. The Rajahmundry Production Enhancement Contract (PEC) is set to contribute around INR 140 crore annually from FY27, with partial revenue starting H2 FY26. The Prabha barge also commenced revenue generation in May 2025, underscoring diversified operational strength.

Margin Enhancement and Prudent Investments

Deep Industries aims to maintain healthy EBITDA margins (40-45%) with expected overall improvement. The Dolphin business anticipates significant margins, projected at over 60-65%. Rohan Shah stated,

“Margins going to improve going further… will definitely increase on EBITDA level.”

Strategic capital expenditure supports expansion. INR 350-400 crore is planned for new Dolphin tugs and vessels, contingent on firm orders. Additionally, INR 160 crore is earmarked for PEC capex across FY26-FY27. The company aims to add at least two more Dolphin vessels and one new workover rig this year, aligning investments with market demand. Kandla Energy is also projected to improve operating costs by 1.5-2% from next financial year.

Deep Industries is positioned for multi-year growth, backed by strong market demand and a substantial order book. Disciplined capital allocation, focus on operational efficiencies, and strategic investments in new assets are expected to drive sustained revenue expansion and enhanced profitability. This clear roadmap and robust fundamentals aim to deliver long-term stakeholder value, solidifying its role in the oil and gas support services sector.

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