Sunita Tools hits the roof after bagging major LOI for supply of artillery shells

Sunita Tools hit an upper circuit of 5% at Rs 964.95 after the company announced that it has received a major letter of intent (LOI) for the supply of empty artillery shells 155mm M107.

According to the company's project classification, the contract is valued between Rs 200 crore and Rs 300 crore. The order involves the delivery of 100,000 pieces, with the supply set to commence at a rate of 7,500 pieces per month until the full order is completed.

The LOI has been issued by a prominent defense supplier from a neutral and friendly country in the Far East. The Ministry of Defence (MOD) of that country will directly issue the End-User Certificate (EUC) to Sunita Tool.

The company stated that an advance payment to secure manufacturing volumes for the order is expected very soon. This significant contract marks a major step forward in Sunita Tools' growth trajectory. In response, the company is preparing to set up large-scale infrastructure and assemble a dedicated team to ensure the order's completion within 14 months. The first deliveries are expected to begin shortly, with the company committed to meeting the timelines without compromising on quality.

Sanjay Pandey, chairman & whole-time technical director of Sunita Tools, said, We are fully committed to meeting the challenges this major order brings and are working diligently to set up the infrastructure and team needed for large-scale production. Our focus will be on completing the order within the specified 14-month period, with timely monthly deliveries. The timely joining of Mr. Tarun Thapar will be an invaluable asset in helping us achieve the highest standards of quality and timely deliveries for this prestigious project. We look forward to the journey ahead and are excited about the contributions this project will make to the overall growth and success of Sunita Tools."

Sunita Tools is engaged in the manufacture of ground plates, mould bases, and precision CNC machining.

On a full-year basis, the company's standalone net profit jumped 61.7% to Rs 4.85 crore in FY24 as against Rs 3 crore posted in FY23. Revenue from operations surged 88.5% to Rs 26.09 crore in FY24 as compared to Rs 13.84 crore recorded in FY23.

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