Shiv-Vani Oil is India’s largest services provider for onshore exploration and production activities and is currently operating 40 rigs. It is the largest seismic data operator and also the largest operator of land breaks in India.
It has posted a good performance for the second quarter ended 30th September 2009. YoY, net sales rose 58% at Rs.323.52 crore. Contract expenses rose 72% and despite oil prices now ruling lower than last fiscal, its outgo on oil and lubricants rose 68%. But firmer prices on rigs helped it shore the margins. EBIDTA was up 52% at Rs.138.23 crore. Net profit was up 18% at Rs.56.39 crore.
The improvement in the performance has been mainly on the back of deployment of five new onshore rigs. Depreciation of the rupee has also helped as it has posted a currency fluctuation gain of Rs.3.69 crore as against a loss of Rs.3.66 crore in Q1FY10.
The company is sitting on a debt of around Rs1,400 crore , payable in about six years. The huge interest outgo, which in Q2FY10 was at Rs.40.80 crore v/s Rs.17.51 crore in Q2FY09, is the effect of this debt burden. Taking the recourse which many others have taken, the company is looking at the option of raising funds to the tune of Rs.600 crore, either via QIP or private placement to be used to retire debt and fund its future capex.
The current fiscal will remain good for the company, notwithstanding the ONGC fracas. Infact ONGC has stated that it will go ahead with Shiv Vani as it has already made expenditures in facilitating the delivery of rigs by Shiv-Vani and it is difficult for ONGC to scrap the contract at this juncture. ONGC had already imposed on Shiv-Vani a 5% penalty on the Rs 1,610-crore contract value for failure to meet the time schedule. It has also given the company its sixth extension for the completion of the 8th rig.
Looking ahead, the company currently has an order book of Rs.3500 crore of which 46% comprises of the order from ONGC. The first half of the company has been good and it will surely be able to more than surpass FY09 performance as all its rigs are deployed for the next three years. It has also put in bids for several new contracts.
Source: www.premiuminvestments.in (By S P Tulsian)
It has posted a good performance for the second quarter ended 30th September 2009. YoY, net sales rose 58% at Rs.323.52 crore. Contract expenses rose 72% and despite oil prices now ruling lower than last fiscal, its outgo on oil and lubricants rose 68%. But firmer prices on rigs helped it shore the margins. EBIDTA was up 52% at Rs.138.23 crore. Net profit was up 18% at Rs.56.39 crore.
The improvement in the performance has been mainly on the back of deployment of five new onshore rigs. Depreciation of the rupee has also helped as it has posted a currency fluctuation gain of Rs.3.69 crore as against a loss of Rs.3.66 crore in Q1FY10.
The company is sitting on a debt of around Rs1,400 crore , payable in about six years. The huge interest outgo, which in Q2FY10 was at Rs.40.80 crore v/s Rs.17.51 crore in Q2FY09, is the effect of this debt burden. Taking the recourse which many others have taken, the company is looking at the option of raising funds to the tune of Rs.600 crore, either via QIP or private placement to be used to retire debt and fund its future capex.
The current fiscal will remain good for the company, notwithstanding the ONGC fracas. Infact ONGC has stated that it will go ahead with Shiv Vani as it has already made expenditures in facilitating the delivery of rigs by Shiv-Vani and it is difficult for ONGC to scrap the contract at this juncture. ONGC had already imposed on Shiv-Vani a 5% penalty on the Rs 1,610-crore contract value for failure to meet the time schedule. It has also given the company its sixth extension for the completion of the 8th rig.
Looking ahead, the company currently has an order book of Rs.3500 crore of which 46% comprises of the order from ONGC. The first half of the company has been good and it will surely be able to more than surpass FY09 performance as all its rigs are deployed for the next three years. It has also put in bids for several new contracts.
Source: www.premiuminvestments.in (By S P Tulsian)
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