Shares of ​Jindal Drilling & Industries moved up on strong volumes

Jindal Drilling & Industries, an energy explorer, moved up on strong volumes for the second day on Thursday partly on account of a policy change announced by the government and some due to a new CEO who takes charge.

The government announced on Wednesday that 69 fields, which were released by state-run ONGC and Oil India Ltd., will be thrown open to private auctions in 3 months in a bid to unlock 70,000 crore rupees worth of oil or gas assets. These auctions will be conducted under the Marginal Fields Policy, which received the Cabinet's nod. The private players will be allowed to sell the extracts at market price, the government said.

This news has injected fresh life into Jindal Drilling and its peers, some of whom are languishing at multi-year lows due to a massive fall in global crude oil prices, which makes exploration more expensive and less remunerative.

As a consequence, Jindal Drilling rose 12.9 percent to 161.30 rupees on the National Stock Exchange where 4.48 lakh shares were traded compared with a 5-day average of 36,000 shares. The company also informed the exchanges that Hemant Kumar Khanna has taken over as the new chief executive officer of Jindal Drilling from September 1st.

The company's market value has dipped 33 percent in the past one year to 430 crore rupees. The stock trades at 0.6 times its book value of 282 rupees.

Image credit: Indiatimes