Gandhar Oil Refinery

Gandhar Oil Refinery Secures ₹375 Crore Contract from ADNOC Distribution for 30 Million Litres Annually

Texol Lubritech FZC secures a ₹375 crore annual contract from ADNOC Distribution for manufacturing 30 million litres annually, boosting Gandhar Oil’s Middle East presence.**

Gandhar Oil Refinery (India) Ltd.'s foreign subsidiary, Texol Lubritech FZC, has landed a three-year contract with Abu Dhabi National Oil Company (ADNOC) Distribution, UAE. Under this agreement, Texol Lubritech FZC will be responsible for the manufacturing, packaging, labeling, and supply of products on a contractual basis. The annual value of this contract is estimated at ₹375 crore for each year spanning 2024 to 2026, totaling ₹1,125 crore over the contract’s duration with a projected annual quantity of 30 million litres.

Gandhar Oil Refinery

Gandhar Oil Refinery, renowned for its production of white oil and specialty lubricants, is now focusing on the consumer and healthcare sectors. The company’s products serve as key ingredients for numerous industries, including automotive, industrial, power, tire, and rubber. Following the announcement, Gandhar Oil Refinery’s shares rose by 3.78%, closing at ₹216.77 per share.

ADNOC Partnership and Prospects

Founded in 1971 and wholly owned by the Abu Dhabi Government, ADNOC is a diversified energy group. The partnership with ADNOC is expected to boost Gandhar Oil’s presence in the Middle East and open avenues for growth. Promoter and Joint MD Parekh of Gandhar Oil Refinery remarked, “This agreement highlights our capability to deliver high-quality products and services on a large scale. We are confident that our partnership with ADNOC will strengthen our presence in the Middle East and pave the way for future growth and collaboration.”

Stock Market Performance

Gandhar Oil Refinery’s shares have experienced significant fluctuations since their debut in November 2023 at an IPO price of ₹169. The stock was listed at a 76% premium at ₹298, reaching an all-time high of ₹344. However, it now trades 35% below its peak. Despite this, the company’s shares ended 5.8% higher at ₹221 following the contract announcement, though they remain down 20% for 2024.

Conclusion

This contract win from ADNOC Distribution brings out Gandhar Oil Refinery’s current position in the market for further expansion in the Middle East. With a steady annual contract value of ₹375 crore and a substantial volume commitment, the company seems poised for growth and market strength.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.