South West Pinnacle Exploration Limited

South West Pinnacle Exploration Ltd. delivered its best-ever quarter in Q2 FY26, with operating revenue surging 128% year-on-year to INR 62 crores. This robust top-line growth translated into significant profitability, with EBITDA increasing 326% year-on-year to INR 15 crores, achieving an EBITDA margin of 23.24%. Net Profit After Tax saw a remarkable 20-fold increase, reaching INR 8.4 crores compared to INR 40 lakhs in Q2 FY25. For the first half of FY26, operating revenue grew 81% to INR 103 crores, and PAT increased 4.7 times to INR 11 crores, demonstrating consistent execution and efficiency.

The company is actively pursuing strategic growth avenues both domestically and internationally. A new Joint Venture, Al Hadeetha Mining LLC, has been formed in Oman and has already commenced exploration activities for copper and gold, strengthening the company's Middle East footprint. Domestically, South West Pinnacle was awarded a coal block in Jharkhand by the Ministry of Coal, covering 266 hectares with estimated geological reserves of 84 million tonnes. This marks a significant step towards becoming a fully integrated exploration and mining company, with mine development planned post-regulatory approvals.

The company's total order book reached an all-time high of INR 412 crores, providing strong revenue visibility for the coming quarters. During Q2 FY26, new orders worth INR 85 crores were secured, including a notable INR 15 crore contract from JSW Energy Ltd. for coal exploration. The order book composition is approximately 60% from private sector clients and 40% from public sector clients. Management anticipates many contracts to be completed by March 2027, with some extending to FY28, and expects to secure a 'sizable chunk' of new orders from the bid pipeline within the next three to four months.

To support its growth trajectory, South West Pinnacle is expanding its operational capabilities. The company has over 40 operating rigs and is in the process of acquiring five more, with two currently in customs and three expected by December 2025/January 2026. The Jharkhand coal mining project is projected to require a total investment of over INR 400 crores, to be executed in two phases (INR 225 crores for Phase 1 and INR 175-200 crores for Phase 2). This investment is planned to be funded through internal accruals, off-takes from industry players, bank support, and revenue generated from the first phase of the project.

The company's receivables increased to INR 99 crores and inventories to INR 48 crores, which management attributed to the significant increase in revenue and the expansion of its rig fleet. They assured that all money is realized in a timely manner, with no bad debts in the past 18 years. Management maintains a revenue growth guidance of 15-20% CAGR for the next three to five years, expecting the bottom line to grow at a substantially faster pace due to operating leverage. The second half of FY26 is anticipated to be stronger than the first half, driven by favorable weather and peak project activities.