Deep Industries Limited — Investor Presentation 2023

Nov 3, 2023

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November 03, 2023

To, To, Corporate Relations Department Corporate Relations Department BSE Limited National Stock Exchange of India Ltd 2[nd] Floor, P.J. Towers, Exchange Plaza,Plot No. C/1, G-Block, Dalal Street, Bandra Kurla Complex, Bandra (E), Mumbai – 400 001 Mumbai – 400 051. SCRIP CODE : 543288 SYMBOL : DEEPINDS

Sub: Investors/ Analysts Presentation and Audio recording of Conference Call pertaining to UnAudited Financial Results for the quarter and Half year ended on 30[th] September, 2023 held on 03[rd] November, 2023

Respected Sir/ Madam,

In furtherance of our letter dated 31[st] October, 2023, informing the Exchanges regarding conference call in respect of the financial results of the Company for the quarter and half year ended 30[th] September, 2023, we wish to inform that the said conference call was held on 03[rd] November, 2023.

The presentation made to the participants is attached with this letter and the audio recording of the conference call has been hosted on the website of the Company and is available at Companies Website in following paths.

Investor Presentation	https://www.deepindustries.com/investor-presentations.html
Audio Recording	https://www.deepindustries.com/call-recording.html

You are requested to take the same on your records.

Thanking you,

For, Deep Industries Limited

SHILPA SHARMA Digitally signed by SHILPA SHARMADN: cn=SHILPA SHARMA c=IN l=AHMEDABAD o=Personal e=SHILPA@FOCALCORPORATE.COMReason: I am the author of this documentLocation: Date: 2023-11-03 20:10+05:30

Shilpa Sharma Company Secretary & Compliance Officer M. No.: A34516

Encls: a/a

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CREATING VALUE FOR OIL & GAS INDUSTRY

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Investor Presentation – H1 & Q2 FY2024

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SAFE HARBOR

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This presentation and the accompanying slides (the “Presentation”), which have been prepared by Deep Industries Ltd. (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company. This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded.

This presentation contains certain forward looking statements concerning the Company’s future business prospects and business profitability, which are subject to a number of risks and uncertainties and the actual results could materially differ from those in such forward looking statements. The risks and uncertainties relating to these statements include, but are not limited to, risks and uncertainties regarding fluctuations in earnings, our ability to manage growth, competition (both domestic and international), economic growth in India and abroad, ability to attract and retain highly skilled professionals, time and cost over runs on contracts, our ability to manage our international operations, government policies and actions regulations, interest and other fiscal costs generally prevailing in the economy. The Company does not undertake to make any announcement in case any of these forward looking statements become materially incorrect in future or update any forward looking statements made from time to time by or on behalf of the Company.

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Investor Presentation – H1 & Q2 FY2024

INDEX

01 Company Background

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02 Financial & Strategic Highlights of Q2 FY24 03 Order Book Highlights

04 Robust Credit Rating

05 Management Team

06 Subsidiary Ops & Details 07 Strengths & Opportunities

08 Growth Drivers

09 Company Financials 10 CSR

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COMPANY BACKGROUND

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Deep Industries Ltd. is specialized in providing various of Oil & Gas support services including Natural Gas Compression Services, Drilling and Workover Rigs Services, Natural Gas Dehydration Services and Integrated Project Management Services. Deep has been an ‘One Stop Solution Provider’ for every need of the Energy Sector including Oil and Gas field operations and services. Its comprehensive services portfolio is well supported by skilled manpower and a wide range of equipment's to be used in the industry right from Exploration & Production Services to the Mid Stream Services while maintaining safety and quality as an integral part of the company culture. Recently, the company also forayed into EPC of gas processing facilities on charter hire basis for our client. Deep Industries is the first entity in the country to provide this one of it’s kind service

Verticals of the company:

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Natural Gas Drilling and Compression Workover Rigs Services Services

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Integrated Natural Gas Project Dehydration Management Services Services

Deep Industries recently received a Letter of Award from ONGC Limited for Charter Hiring of 1 number of 90 MT Mobile Drilling Rigs with Integrated Mud Services & METP with Manpower for 3 years for their CBM Asset, Bokaro with the order worth being INR 130 Crores. The Company also received Letter of Award from ONGC Limited for Charter Hiring of HP compressors at GCP Geleki, Assam for a period of 3 years. The total estimated value of the said award is approximately INR 108 crore

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Investor Presentation – H1 & Q2 FY2024

COMPANY BACKGROUND

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International

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Deep International DMCC has supplied a modular compression station for a client in Egypt to counter well head pressure reduction and maintain well head gas production. The project was executed on a Build/ Own/ Operate basis with the partner in Egypt.

Deep Onshore Drilling Service Private Limited, a subsidiary company of Deep Industries, entered into a JV with Euro Gas Systems to enhance the company’s technical expertise and know how to further support gas field services.

Middle East Fast Track Compressor Overhaul – The Company has supplied quantity four gas compressor packages for a debottlenecking project in Gulf for a client.

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Investor Presentation – H1 & Q2 FY2024

FINANCIAL HIGHLIGHTS OF Q2FY24

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Consolidated Performance for Q2FY24

Standalone Performance for Q2FY24

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Revenue EBITDA PBT
Rs. 101 Cr. Rs. 48 Cr. Rs. 38 Cr.
52% YoY 129% YoY 168% YoY
EBITDA PAT
PAT
Rs. 29.5 Cr. Margin Margin
43% 27%
342% YoY
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Revenue EBITDA PBT
Rs. 91 Cr. Rs. 42 Cr. Rs.32 Cr.
50% YoY 44% YoY 41% YoY
PAT EBITDA PAT
Rs. 24 Cr. Margin Margin
39% YoY 44% 25%
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Figures are on Consolidated basis and rounded off to nearest decimal place.

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Investor Presentation – H1 & Q2 FY2024

STRATEGIC HIGHLIGHTS OF Q2 FY24

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1
Order Book Growth
The resilient growth on the order book EPC of Gas Processing
has continued for a record 10 [th ] quarter
facility on charter hire basis
for Q2FY24. The Order
Deep Industries has forayed into this
Book now stands at a supreme
one of its kind model unlocking a new
4 Rs. 1,195 (add approx. symbol) Crores
revenue stream for the company
Dolphin Offshore Revival
Dolphin Offshore successfully executed JV with Euro Gas S.R.L 2
a QIP of Rs. 38.5 Crores by allotting
With this JV, the company is able to
8.42L shares of FV 10 at an issue
achieve objective to enter into EPC
price of Rs. 458
and supply of superior Oil and
Gas field equipments
3
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Investor Presentation – H1 & Q2 FY2024

ORDER BOOK HIGHLIGHTS

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Order Book (Rs. Cr.)
1195
1160
1078
976
815
765
632
556
434
400
Q1FY22 Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 Q2FY24
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Q2FY24 Major Order Wins

The company secured an order from ONGC for Charter Hiring of HP compressors at their GCP Geleki site in Assam for a period of 3 years. This order is worth INR 108 Crores

Robust Bidding Pipeline

Company is witnessing highest ever bidding pipeline which could further enhance the order book going forward

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Figures are on Consolidated basis and rounded off to nearest decimal place.

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Investor Presentation – H1 & Q2 FY2024

ROBUST CREDIT RATING

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CARE Ratings has reaffirmed “A Rating” with an upgraded outlook from “Stable ” to “Positive” citing healthy growth in the order book position leading to growth in the scale of operations and strong liquidity position.

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Investor Presentation – H1 & Q2 FY2024

LONG TERM CLIENT RELATIONSHIPS

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…a testimony of our capabilities

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Investor Presentation – H1 & Q2 FY2024

MANAGEMENT TEAM

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PARAS SAVLA Chairman and Managing Director

With over three decades of expertise, he graduated in Commerce from Gujarat University. Under his leadership, the organization has experienced exponential growth. Guided by his vision, the company has evolved from a mere transportation service entity to a comprehensive provider of energy infrastructure equipment solutions.

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RUPESH SAVLA Managing Director

Possessing over 27 years of experience in the energy sector, he has steered the organization towards extensive operational expansion. He completed his Masters in Business Administration from Bentley College, USA, and holds a degree in Commerce from Gujarat University. His responsibilities include supervising the coordination and implementation of various projects.

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ROHAN SHAH Director Finance & CFO

A Chartered Accountant with over 17 years of expertise in Finance, Accounts, Audit, and Statutory Compliances, he has dedicated more than 13 years to Deep, assuming several high-ranking financial roles, including Chief Financial Officer. Before joining Deep, he served at ICICI Bank Limited. In 2019, he was honored with the "Financial Express CFO of the year award" in the category of Small Enterprises - Services Industry.

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Investor Presentation – H1 & Q2 FY2024

SUBSIDIARY OPS & DETAILS

Dolphin Offshore: A leading company in the country providing offshore services to Oil & Gas Industry. Dolphin’s key asset currently being refurbished, has a tremendous utilization in the Industry and is already getting EOI. Dolphin is expected to contribute a significant portion to the entity’s topline in the coming FYs given it’s wide application scope.

Deep International DMCC: Based in Dubai, DMCC is a wholly based subsidiary of Deep Industries. This international arm of the company is providing similar Gas Processing Services across the Middle East, Africa, and Asia. DMCC is also engaged in some level of trading of customized gas processing equipments.

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RAAS Equipments: The company produces advanced Booster Compressor Packages with capacities of 22 kW and 37 kW that boast superior efficiency, minimal noise emissions, and meticulously engineered designs. These Booster compressors fully adhere to regulatory mandates and meet the stringent specifications outlined by PESO.

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Investor Presentation – H1 & Q2 FY2024

1

3

STRENGTHS & OPPORTUNITIES

Demonstrating remarkable operational efficiencies, the company consistently utilizes it’s executional abilities in 4-6 months that often take other organizations 10-12 months. This feat is attributed to our skilled and dedicated workforce, coupled with an outstanding supply chain bolstered by strong vendor relationships, ensuring an impressive operational efficiency rate of 99.6%.

The company's subsidiary is actively pursuing sustainable offshore opportunities, with promising prospects that are expected to unlock significant value in the foreseeable future.

As the market demand for gas compression services continues to rise, the company is poised for an expansion, capitalizing on the increasing trend of outsourcing this specialized service.

5

2

4

6

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Leveraging the flexibility of fully mobile units, the company can expediently transport its resources to any corner of the country within a matter of months.

The company's liquidity and robust resource base position it favorably to meet expansion requirements seamlessly. The company has mirrored its financial moats from its core principles, maintaining a judicious balance between liquidity and debt on its books, consequently fostering a strong balance sheet.

Deep Industries has supreme Expertise in providing Value added services for our clients which in turn improves their revenue generating ability as well as profitability at large and provides a diversified service mix for their product portfolio

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Investor Presentation – H1 & Q2 FY2024

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GROWTH DRIVERS

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The company's current vision entails replicating the remarkable expansion achieved over the past 25 years within the next 5 years. The company is seeing unprecedented demand across all it’s verticals at elevated levels and this upward trajectory is expected to continue sustainably

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Implementation of fully mobile units, facilitating swift relocation to any part of the country within a few months. Proactive forecasting of contract renewals enabling optimal resource planning in advance. Minimization of time drag for subsequent optimization and utilization of equipments between contracts for any re-engineering or client related re-configurations as they are finalized in the final 3-4 months of the prior contract period.

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DMCC is thriving by prioritizing tailored and specialized solutions for clients in the Gulf region.

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Nations like Kuwait exclusively shortlist qualified enterprises, with our company, Deep, being one of the selected few. Moreover, the favorable day rates in the Gulf region should potentially enhance our margin expansion.

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The company envisions substantial growth prospects in the offshore support services sector, spearheaded by the strategic initiatives of Dolphin.

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India's strategic directive to bolster self-reliance in energy production underscores the substantial contribution of Public Sector Undertakings (PSUs) to this goal.

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The industry exhibits relatively subdued competition, largely attributable to its significant capital-intensive nature, operational efficiencies and extreme discipline in leverage.

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Investor Presentation – H1 & Q2 FY2024

P&L STATEMENT (Consolidated Basis)

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Particulars (Rs. Cr)	Q2FY24	Q2FY23	YoY	H1FY24	H1FY23	FY23
Revenue from Operations	101.32	66.67	52%	202.64	139.82	341.34
Other Income	9.67	1.82		15.27	4.14	11.25
Total Income	110.99	68.49	62%	217.91	143.96	352.59
Direct Expenses	43.59	33.76		83.35	62.79	144.69
Employee Expenses	11.66	7.73		22.38	14.98	34.42
Other Expenses	7.51	5.94		15.36	13.21	31.68
EBITDA	48.23	21.06	129%	96.82	52.98	141.8
EBITDA Margin	43%	31%		44%	37%	40%
Depreciation & Amortization	9.31	6.4		18.33	12.74	29.6
Finance costs	0.98	0.48		2.61	1.26	5.23
PBT	37.94	14.18	168%	75.88	38.98	106.97
PBT Margin	34%	21%		35%	27%	30%
Exceptional Item*	0			101.5	0	44.69
PBT after Exceptional Item	37.94	14.18		177.38	38.98	151.66
Tax & Deferred Tax	8.42	5.57		16.35	10.86	26.36
PAT	29.52	8.61	342%	59.53	28.12	80.61
PAT Margin	27%	13%		27%	20%	23%

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Investor Presentation – H1 & Q2 FY2024

ANNUAL FINANCIALS (Balance Sheet)

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Particulars (Rs. Crs)	Mar-23	Mar-22	Particulars (Rs. Crs)	Mar-23	Mar-22
Non-Current Assets	1075.0	943.3	Equity	1379.4	1,130.0
			Share Capital	32.1	32.0
PropertyPlat & Equipment	622.2	483.5	Other Equity	1347.3	1,098.0
Capital Work In Progress	19.8	4.6	Non-ControllingInterest	-	0.3
Intangible Assets	384.9	384.9	Total Non-Current Liabilities	98.4	60.4
Investments	1.1	16.9	Borrowings	37.6	11.3
Other Financial Assets	2.5	4.5	Others
Other Non – Current assets	44.5	48.8	Deferred Tax Liabilities(Net)	60.8	49.1
Total Current Assets	512.0	317.1	Other Non –Current Liabilities
Inventories	45.7	39.7	Provisions
Investments	47.2	56.4	Total Current Liabilities	109.2	69.6
Trade Receivables	252.3	135.4	Borrowings	32.2	20.4
Cash & Cash Equivalents	20.3	12.0	Trade Payables	55.4	38.2
Bank Balance other then above	22.5	19.9	Other Financial Liabilities	6.6	4.5
Loans	-	-	Current tax liabilities(Net)	5.3
Other Financial Assets	7.7	0.6	Provisions
Other current asset	116.3	52.7	Other Current Liabilities	9.5	6.3
Total Assets	1587.0	1,260.4	Total Equity & Liabilities	1587.0	1,260.4

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Investor Presentation – H1 & Q2 FY2024

HOW DEEP INDUSTRIES MAKES A DIFFERENTIATOR

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Diversified Service Portfolio:

Offering a wide range of services in various sectors, catering to a diverse client base, and ensuring stability through different market fluctuations and demands.

Continuously Growing Order Book:

Sustained increase in the number of orders and contracts, indicating a strong demand for the company's services and reflecting customer satisfaction and market confidence.

Net Debt Free with Consistent Debt-to-Equity Ratio (D/E) Control:

Maintaining a healthy financial structure with no net debt and a history of never exceeding a D/E ratio of more than 1, signifying sound financial management and a low-risk profile.

Strong Balance Sheet and High Liquidity:

Demonstrating robust financial health and stability, the company possesses significant liquid assets, enabling it to seize both organic and inorganic business opportunities within the industry swiftly and effectively.

Value-Added Services and Preferred Service Provider Status:

Providing additional services that go beyond the basic requirements, resulting in increased customer satisfaction and loyalty, ultimately establishing the company as the preferred service provider in the industry.

Increased Demand for Services in the Industry:

Due to the exceptional value addition services provided, the company is experiencing a surge in demand for its offerings within the industry, indicating a strong competitive position and potential for further growth and expansion.

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Investor Presentation – H1 & Q2 FY2024

CSR

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Smart Class Initiative

Medical Check-Up Centre

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Continuing their commitment to CSR, Deep Foundation, the charitable division of Deep Industries Limited, inaugurated a cutting edge Medical Checkup centre at Shri Kutchi Jain Sewa Samaj in Ahmedabad. The primary objective of this centre is to offer affordable medical checkup services, ensuring accessibility for all strata of society.

Deep Industries Ltd. initiated a program to implement Smart Classes in schools catering to underprivileged children. The aim is to facilitate the comprehensive development of students through the integration of contemporary technology. Currently, this initiative has been successfully implemented in 50 schools.

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Investor Presentation – H1 & Q2 FY2024

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THANK YOU

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CIN: L14292GJ2006PLC049371 Mr. Rohan Shah, CFO rohan@deepindustries.com

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Namit Shah, CFA

Sr. Associate - IR

• Email: namit@s ancial.com

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215, Shivshakti Industrial Estate, J.R Boricha Marg, Lower Parel (E) Mumbai - 400011