Ellenbarrie Industrial Gases shares rallied 5.10% to ₹377.35 on Tuesday following the announcement of a significant contract win from Bharat Heavy Electricals Limited (BHEL). The stock surge reflects investor confidence in the company's ability to execute large-scale industrial projects, with the latest contract representing a substantial addition to the company's order book. The positive market response demonstrates strong investor interest in the company's expansion into India's coal gasification ecosystem.
Ellenbarrie Industrial Gases has secured a significant contract worth ₹481.0 crore from Bharat Heavy Electricals Limited (BHEL). The contract involves the design, engineering, supply, erection, testing, pre-commissioning, commissioning, trial runs, operator training, demonstration of performance guarantees, supply of spares and handing over of a 1200 TPD Cryogenic Air Separation Unit (ASU). The order is part of the Coal to Ammonium Nitrate (2000 TPD) Project at Bandhabal, Jharsuguda district, Odisha, on a Build and Transfer (B&T) basis with an execution period of eight quarters and expected commissioning in FY29. The contract scope includes all activities on a turnkey basis with no long-term ownership or operation of the plant involved.
The project is expected to contribute incremental EBITDA of about ₹24 crore over the next eight quarters, with specific contributions of ₹6 crore in FY27, ₹12 crore in FY28 and ₹6 crore in FY29 assuming a conservative 5% EBITDA margin. According to JM Financial, the contract represents a significant milestone for Ellenbarrie Industrial Gases, with the company expected to deliver revenue/EBITDA/PAT CAGR of about 32%/33%/30% over FY26-29E driven by a 23% CAGR in merchant volume due to strong capacity expansion. The project's inclusion in the Government of India's National Coal Gassification Mission can improve future order visibility from similar projects.
From a technical perspective, the stock is trading above six of its eight key simple moving averages (SMAs). The company's price-to-earnings (P/E) ratio stands at 41.94, while the price-to-sales (P/S) ratio is 8.14 and price-to-book (P/B) ratio is 5.18. The stock has touched a 52-week high of ₹500.85 and a 52-week low of ₹175.05, currently trading 28.3% below its 52-week high and 105.14% above its 52-week low. The company's market capitalization stands at around ₹5,061 crore as of the latest data. JM Financial has raised the target price to ₹430 from ₹385 based on an unchanged 30x September 2028E P/E, maintaining a Buy rating.
