BLACK GOLD--SELAN EXPLORATION
Printed From: The Equity Desk
Category: Market Strategies
Forum Name: Words of Wisdom
Forum Discription: Have you found a golden rule to profitable investing? Share experiences, articulate your thoughts quote a book or a guru.
URL: http://www.theequitydesk.com/forum/forum_posts.asp?TID=603
Printed Date: 07/May/2025 at 4:28pm
Topic: BLACK GOLD--SELAN EXPLORATION
Posted By: Friend
Subject: BLACK GOLD--SELAN EXPLORATION
Date Posted: 19/Nov/2006 at 2:10pm
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SELAN EXPLORATION IS INTO OIL EXPLORATION. THE BEST PART ABOUT IT IS THAT ITS WORKING ON ALL PROVEN FIELDS WHICH RESULT IS HUGE SAVINGS ON PROBABILITY OF GETTING THE OIL OR NOT GETTING IT. ITS CLEAR PLAY ON GETTING MORE OIL FROM ITS WELL AND THUS REPORTING MORE PROFITS. THIS YEAR IT IS EXPECTED TO POST TURNOVER OF 30 CRORES WITH BOTTOMLINE OF 12-13 CRORES GIVING EPS OF AROUND 10 . TURNOVER CAN RISE TO 100 CRORES IN NEXT 2 YEARS WITH INCREASE IN PRODUCTION AT CURRENT WELL PLUS EXPECTED PRODUCTION ( TO SATRT VERY SOON ) ON NEW FIELD. ITS NET MARGIN IS AROUND 40% .BASANT JI YOUR ANALYSIS WOULD FURTHER INDUCE CONFIDENCE AMONG US
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Replies:
Posted By: basant
Date Posted: 19/Nov/2006 at 5:08pm
Thanks for that infor but I would have no idea in these oil companies maybe someone else might help.
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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Posted By: xbox
Date Posted: 19/Nov/2006 at 4:45am
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In commodities space, I like biggies only. Smal or mid players are not best bets as they hardly survive down-turn.
Oil n gas sector is cash incentive business. These small and mid companies have no or thin cash in books. To increase the business either they borrow cach of dilute equity. In both cases, EPS pie is taken out. Which virtually takes us with no/mild EPS growth.
I like small/mid players only in service industry. Not in any other area.
SELAN is kid and would remain kid for life long. There are few more promising companies like deep industries but same logic applies to these.
If in case somebody want to bet on small/mid caps of oil and gas sector, then rather bet on service providers of this sector. Which provides services, consultancy, expertise to these sectors. I can give u name.. they are multibagger in times to come ..
GE offshore, SAAG rr, shiv vani oil, alphanso, aban offshore etc. etc.
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Don't bet on pig after all bull & bear in circle.
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Posted By: Ajith
Date Posted: 20/Nov/2006 at 4:02pm
I have shares in Selan.I would buy more if I could be certain of the fact that there is more oil below.
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Ajith
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Posted By: RAKESH
Date Posted: 31/Dec/2006 at 6:48pm
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AS REPORTED IN BSE....
29-Dec-06 SELAN SELAN EXPLO. TECH LTD MERRILL LYNCH CAPITAL MARKETS E BUY 76000 80.83
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Posted By: PrashantS
Date Posted: 31/Dec/2006 at 7:51pm
But this company doesnt advertise ....or dont want to be in the limelight ...heard they are good company with good management
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Posted By: subu76
Date Posted: 04/Aug/2009 at 12:48pm
Originally posted by Friend
SELAN EXPLORATION IS INTO OIL EXPLORATION. THE BEST PART ABOUT IT IS THAT ITS WORKING ON ALL PROVEN FIELDS WHICH RESULT IS HUGE SAVINGS ON PROBABILITY OF GETTING THE OIL OR NOT GETTING IT. ITS CLEAR PLAY ON GETTING MORE OIL FROM ITS WELL AND THUS REPORTING MORE PROFITS. THIS YEAR IT IS EXPECTED TO POST TURNOVER OF 30 CRORES WITH BOTTOMLINE OF 12-13 CRORES GIVING EPS OF AROUND 10 . TURNOVER CAN RISE TO 100 CRORES IN NEXT 2 YEARS WITH INCREASE IN PRODUCTION AT CURRENT WELL PLUS EXPECTED PRODUCTION ( TO SATRT VERY SOON ) ON NEW FIELD. ITS NET MARGIN IS AROUND 40% .BASANT JI YOUR ANALYSIS WOULD FURTHER INDUCE CONFIDENCE AMONG US |
My Friend your prophesies have all come true....
Ajith are you still invested on this one?
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Posted By: kumardiwesh
Date Posted: 04/Aug/2009 at 1:27am
Its revenues depend completely on oil prices.
Most of its costs are fixed.
So oil prices would matter a lot.
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"History does not tell you the probability of future financial things happening" - Warren Buffett
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Posted By: Ajith
Date Posted: 04/Aug/2009 at 8:04am
Subu76,
I am tracking Selan( but do not currently have significant holding at present) closely because management has indicated that though production will stagnate in the current year there may be significant ramp up after that because of new technology available.At current oil prices of 71 dollars Selan is undervalued even with current production levels.
As an aside,did you hear about ONGC drilling aggressively off Kochi? Its more or or less certain that there is oil as I understand very reliably but not 100 percent certain of course.
Over a longer period I am bearish on oil.The reason being US is coming up with strict fuel efficiency norms.Also alternatives are gaining ground.
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Ajith
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Posted By: subu76
Date Posted: 04/Aug/2009 at 9:39am
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Yup...this is a purely oil price story....actually they call it out in all their statements...
What attracts me to this cyclical company is that:
- it has guaranteed business
- low capex
- management does buybacks.
- management abhors financial engineering and debts
Ajith, How will ONGC's drilling impact the prospects Selan?
This one sure seems interesting.
Do you also track Dolphin Offshore? The story there has improved last year...but the stock has also run up.
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Posted By: subu76
Date Posted: 04/Aug/2009 at 9:58am
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Ajith, i have another question for you? Do you know how long their contracts run? Also, they won a new mining license on OGNAJ field in Aug 08...any idea if the numbers from this field is already showing up?
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Posted By: kumardiwesh
Date Posted: 04/Aug/2009 at 11:49am
Originally posted by subu76
Yup...this is a purely oil price story....actually they call it out in all their statements...
What attracts me to this cyclical company is that:
- it has guaranteed business
- low capex
- management does buybacks.
- management abhors financial engineering and debts
Ajith, How will ONGC's drilling impact the prospects Selan?
This one sure seems interesting.
Do you also track Dolphin Offshore? The story there has improved last year...but the stock has also run up.
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The company is also free cash flow positive.
Its fixed assets turnover ratio has been going up over the last 5 years.
Promoter holding has also gone up from Dec-08 to Jun-09.
Makes a compelling case for investment except that this is a cyclical.
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"History does not tell you the probability of future financial things happening" - Warren Buffett
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Posted By: subu76
Date Posted: 05/Aug/2009 at 1:20pm
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Indeed this is my dilemma too.........
If it's a cyclical then i'd loved much more beaten down valuations....though it is not overvalued now for sure....
One point which i have is....shouldn't we also be looking at these as growth stories? These guys are winning new contracts all the time....so though revenues get impacted by oil prices...will they be able to do better overall?
Overall buy backs and management buys is a story across the entire oil sector..atleast in the smaller companies...seems like good times are ahead
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Posted By: kumardiwesh
Date Posted: 05/Aug/2009 at 3:24pm
Any idea how much production is planned for the current year and the coming year(s)?
What are the proven reserves of the company?
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"History does not tell you the probability of future financial things happening" - Warren Buffett
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Posted By: subu76
Date Posted: 05/Aug/2009 at 3:47pm
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I have there 2008 AR only...that's the only one uploaded on their site:
Here is the data points i see in the AR
1. Bakrol Oilfield has 73.3 mmbbls reserve
2. Crude oil production during the financial year 2007-08 was 120,226 barrels cumulatively.
Ajith, do you have the data for the other oilfields with this company?
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Posted By: Ajith
Date Posted: 06/Aug/2009 at 8:48am
SUBU76,
I have no idea about extact reserves(but it seems large enough) . I feel its more important to focus on how much oil will be extracted.
This year production is expected to stagnate but management indicated possibility of substantial increase after that.
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Ajith
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Posted By: subu76
Date Posted: 06/Aug/2009 at 9:35am
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Yes true.....that makes sense. Thanks Ajith.
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Posted By: kumardiwesh
Date Posted: 06/Aug/2009 at 10:41am
So much oil are they planning to extract every year?
Can you put a figure to that?
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"History does not tell you the probability of future financial things happening" - Warren Buffett
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Posted By: subu76
Date Posted: 10/Aug/2009 at 11:56am
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They did 2.5 lakh barrels last year.
Management figures it will be less this year. So revenues are likely to be less this year (ignoring oil prices)
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Posted By: shadows
Date Posted: 13/Aug/2009 at 10:05am
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Some brokerages are giving buy call on this with a target of 247....... i got into this two weeks back
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Posted By: go4sheel
Date Posted: 03/Sep/2009 at 3:03pm
From the Management on 26th August 2009:
Q: Which of these fields Bakrol, Indrora or Lohar are you most bullish on for and by when do you think, which quarter going forward do you expect enhanced production to come in. I am not asking you to disclose how much you expect but in which quarter do you think more production might start?
A: In 2010-2011, should see different production rates than we have this year and probably that would mean starting with the first quarter of that year. As far as the potential is concerned, we have much more knowledge about the Bakrol field but there is every reason to believe that the Indrora field will contain far larger quantities of recoverable oil.
Q: So fiscal year 2011, starting next April, will see a dramatic and discontinuer shift in your revenue profile from the current year?
A: Yes. It will begin to see. Over the next two-three years the production levels should change quite dramatically but starting with 2010–2011 definitely we should begin to see different production rates.
Q: How much capex would you need to spend over the next 12–18 months?
A: Over the next 12–24 months, we will spend probably another Rs 100 crore. We have spent about Rs 100 crore to appraise and develop these fields and build the necessary infrastructure over the last few years. But the real question is beyond that what is the capex requirement and that would be a function of what the recovery rates we feel can be achieved. So that would indicate to us that okay you need to drill X number of wells and we know approximately how much each well costs us. However, the capex is also a function of getting the necessary approvals because you might need to drill certain number of wells that you have to carry the DGH with you and convince them so that has to be brought into the picture over the next year to 18 months.
From the above conversation we can conclude that:
1. if Bakrol field has 73 million of proven reserves then Indrora field will have much more reserves as said by management that Indrora field will have far more reserve.
2. They will be spending Rs.100 crore on capex. how will this get funded? however they have reserves but not sure how much. hope the profits or EPS will not be affected with this.
3. Also they mentioned that production will be ramped up significantly from current 2.5lk barrels to 10lk barrels in two years time, though they didnt gave exact nos. but it is anticipated. This sounds good and I think Oil prices will remain firm between $70 to $100 for next few years.
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Posted By: basant
Date Posted: 03/Sep/2009 at 3:05pm
Please quote the source with a link and also do not copy/paste the full text!
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'The Thoughtful Investor: A Journey to Financial Freedom Through Stock Market Investing' - A Book on Equity Investing especially for Indian Investors. Book your copy now: www.thethoughtfulinvestor.in
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Posted By: dilip.r
Date Posted: 21/Sep/2010 at 2:16pm
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Selan Exploration is interestingly poised from a longer-term perspective. We feel that the company owns five oilfields of which it is right now extracting oil from just one field, which has reserves of over 70 million barrels
read full report from link below.
http://www.moneycontrol.com/news/stocks-views/selan-exploration-has-target-rs-382tater-_485545.html - http://www.moneycontrol.com/news/stocks-views/selan-exploration-has-target-rs-382tater-_485545.html
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Posted By: master
Date Posted: 21/Sep/2010 at 9:04pm
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It's a pure play on (i) quantity produced and (ii) crude prices.
On (i), they haven't ramped up in last 1 year, nor seen any management announcement to that effect. They seem to be in seismic studies and prospecting on maximising the output.
On (ii), no signs of firming up.
So what's the trigger at this juncture?
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Someone’s sitting in shade today because someone planted a tree long time ago.
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Posted By: go4sheel
Date Posted: 22/Sep/2010 at 1:14am
how much time it takes to drill the well?
as by now the company must have done the 3d sesmic test(new technology) on the fields by spending 40-50 crores for sweet spots for drilling the wells.
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Posted By: go4sheel
Date Posted: 23/Sep/2010 at 1:58am
About 45% of 3D seismic data acquisition was completed for Selan Exploration Technology Limited in Gujarat as on 31.3.2010
So by now it must be nearing its completion for 3d seismic survey.
Source: Alphageo (India) Ltd. in its director report.
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Posted By: subu76
Date Posted: 24/Sep/2010 at 12:53pm
Originally posted by go4sheel
About 45% of 3D seismic data acquisition was completed for Selan Exploration Technology Limited in Gujarat as on 31.3.2010
So by now it must be nearing its completion for 3d seismic survey.
Source: Alphageo (India) Ltd. in its director report. |
Hey, did you find the Selan data in Alphageo's AR?
Is Alphageo the vendor who is doing it for Selan?
I thought Alphageo is a land based exploration company?
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Posted By: go4sheel
Date Posted: 24/Sep/2010 at 2:00pm
Yes Subu I found out in Alphageo's Annual Report...
link:
http://www.indiainfoline.com/Markets/Company/Fundamentals/Directors-Report/Alphageo-India-Ltd/526397
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Posted By: subu76
Date Posted: 24/Sep/2010 at 7:27pm
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Thank You .... interesting
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Posted By: funkyappu
Date Posted: 24/Sep/2010 at 7:52pm
I have some questions:
1. How oil fields are acquired in India. Kindly explain the process. How Selan got all those 5 oil-fields?
2. I suppose that those oil-fields held by Selan were earlier owned by ONGC. Why were these transferred to Selan, if the fields were ripe?
3. What's the probability of 3D studies turning correct? Are there any upward or downward surprises, after digging the fields?
4. Are there limits on the number of oil-fields to be dug in a particular oil-field?
5. How much time does the drilling of an oil-field takes place, post these 3D seismic studies?
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Posted By: subu76
Date Posted: 25/Sep/2010 at 2:29am
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Lemme take a shot based on what ever little I know.
Originally posted by funkyappu
2. I suppose that those oil-fields held by Selan were earlier owned by ONGC. Why were these transferred to Selan, if the fields were ripe?
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It's ONGC after all.....a highly inefficient monopoly...thanks to NELP we still have a chance of saving some precious foreign exchange.....Turns out...they've been using extremely outdated technology for a long time.....though they seem to be more active now a days
This story is the same a the CWG saga..except that these companies produce so much cash no one questions them.....
Originally posted by funkyappu
4. Are there limits on the number of oil-fields to be dug in a particular oil-field?
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Not aware of any restriction in one's allocated acreage though i'll be surprised if various permissions are not required first.
Originally posted by funkyappu
5. How much time does the drilling of an oil-field takes place, post these 3D seismic studies?
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A lot depends upon the area......enviromental concerns etc could also crop up...typically some more drilling happens on the ground to confirm the studies before actually production quality drilling can beging...atleast that is what i think i figured out from various annual reports
Some experts do pitch in more with these queries.
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Posted By: go4sheel
Date Posted: 27/Sep/2010 at 4:27pm
Its more than one year the management has not come out and updated about their latest development for 3d mapping of the fields and enhancing production output plans...
Hope they come out soon on result day and update us with good news...
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Posted By: excel_monkey
Date Posted: 15/Nov/2010 at 3:48am
Subu
If the story of 2P reserves of 75 million barrels is true
this stock is already a multi bagger (it use to quote in single digit)
and is still a multi bagger from here
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Posted By: excel_monkey
Date Posted: 15/Nov/2010 at 8:05am
http://en.wikipedia.org/wiki/Oil_reserves
Unproved reserves
An oil well in Canada, which has the world's second largest oil reserves
Unproved reserves are based on geological and/or engineering data similar to that used in estimates of proved reserves, but technical, contractual, or regulatory uncertainties preclude such reserves being classified as proved.[10] Unproved reserves may be used internally by oil companies and government agencies for future planning purposes but are not routinely compiled. They are sub-classified as probable and possible. [10]
Probable reserves are attributed to known accumulations and claim a 50% confidence level of recovery. Industry specialists refer to them as P50 (i.e., having a 50% certainty of being produced). These reserves are also referred to in the industry as 2P (proved plus probable).[7]
Possible reserves are attributed to known accumulations that have a less likely chance of being recovered than probable reserves. This term is often used for reserves which are claimed to have at least a 10% certainty of being produced (P10). Reasons for classifying reserves as possible include varying interpretations of geology, reserves not producible at commercial rates, uncertainty due to reserve infill (seepage from adjacent areas) and projected reserves based on future recovery methods. They are referred to in the industry as 3P (proved plus probable plus possible).[7]
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Posted By: subu76
Date Posted: 15/Nov/2010 at 8:43am
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Yeah, these stocks are tricky....I once got a 2 bagger ride about of this one simply because prices had fallen a lot but could not derive any understanding from the whole experience........these new items about big finds has been there for some time.......the aversion to debt (atleast what they used to mention in their annual reports) is something that i admired
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Posted By: excel_monkey
Date Posted: 15/Nov/2010 at 8:48am
Even I have no hurry to get into such a name
commodities are always volatile
let it fall in say next 6-8 months to take entry if one wishes to
what hurts is missing something like a Zydus ((
Originally posted by subu76
Yeah, these stocks are tricky....I once got a 2 bagger ride about of this one simply because prices had fallen a lot but could not derive any understanding from the whole experience........these new items about big finds has been there for some time.......the aversion to debt (atleast what they used to mention in their annual reports) is something that i admired |
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Posted By: susantharakan83
Date Posted: 09/Dec/2010 at 6:10pm
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Mr Porinju Veliyath, maverick investor from South wants this stock to be the largest in his portfolio. [Ref] http://twitter.com/porinju. After having seen and tracked Porinju for over 2 years, I feel his recommendations are often trustworthy.
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Posted By: excel_monkey
Date Posted: 09/Dec/2010 at 6:21pm
the stock has been flying high in such a market
probably there is some good news
http://www.myiris.com/shares/research/SIHL/SELEXPTE_20101101.pdf
http://www.myiris.com/shares/research/sharekhan/SELEXPTE_20100903.pdf
Originally posted by susantharakan83
Mr Porinju Veliyath, maverick investor from South wants this stock to be the largest in his portfolio. [Ref] http://twitter.com/porinju. After having seen and tracked Porinju for over 2 years, I feel his recommendations are often trustworthy. |
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Posted By: India_Bull
Date Posted: 10/Dec/2010 at 12:23pm
Somebody sold around 85000 shares a couple of days back
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India_Bull forever Bull !
www.kapilcomedynights.com
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Posted By: excel_monkey
Date Posted: 10/Dec/2010 at 12:33pm
just to point out 2P oil reserves are a bit farji
how much can be extracted is not known
and at what cost it is extracted is also important
I am sure there would be hundreds of small oil companies quoting worldwide at similar valuations
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Posted By: joslinjose9
Date Posted: 24/Jan/2011 at 4:21am
hi,
dolly khanna has entered this stock in latst quarter.
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fear of lord is the beginning of wisdom
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Posted By: manojdua
Date Posted: 07/Mar/2011 at 2:52pm
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Selan oil field r land base only...alphageo was one of the comp for sciesmic
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Posted By: kumardiwesh
Date Posted: 13/Jun/2011 at 4:52pm
Any updates on this one?
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"History does not tell you the probability of future financial things happening" - Warren Buffett
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Posted By: FutureBull
Date Posted: 02/Oct/2011 at 2:04pm
This company is sitting on 73m barrels of oil in its oilfield. Cost of production is as low as 3-4 USD/bl. A rough calc says they could make 20000 cr profit based on current price and cost over the period of the oilfield. Obviously one has to discount that. As per magmt,. the production could go up 3-4 times in 2012-14. I do not expect oil price to go down meaningfully. Few more positives.
- Debt-free- Amazing to find a debt free Natural resource company. They invest only that much which comes as free cash from business but could leverage balance sheet when needed.
- It has generated 40+CAGR over last 10 yrs.
- Recently one senior Cairn exec joined it who played imp. role in developing Rajasthan field which is considered very complex in the industry.
- Management is just awesome, impeccable, relevant technical exp.
This is one stock which has potential to be another multibagger in 2-3 yrs even if we have recession or slowdown.I am confident they would become another Cairn Plc kind of company in very long run. Cairn Plc made huge money by leveraging its capability to find oil and sell it with massive profit.
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‘The market always does what it’s supposed to — BUT NEVER WHEN’.
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Posted By: rapidriser
Date Posted: 02/Oct/2011 at 9:19am
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@ Futurebull - One thing that puzzles me about this co is that the Capital Work in Progress for last 5 years was Rs.45.84cr. (2007), Rs.54.90cr. (2008), Rs.91.26cr. (2009), Rs.94.71cr. (2010) & Rs.108.13cr. (2011).
However, the Fixed Assets Gross Block in 2011 was only Rs.18.99cr. That means even the Capital Work in Progress as on 31-03-2007 has not been completed and capitalised on 31-Mar-2011.
Does it take so long to install their equipment or am I misinterpreting something here?
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When all else is lost, the future still remains. - Christian Nestell Bovée
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Posted By: FutureBull
Date Posted: 02/Oct/2011 at 9:35am
Rapidriser, I have not looked in detail these numbers. I am still studying and it passed my initial criteria.
What I know about the industry is it takes huge amount of time to bring from exploration stage to production. Once the quantity of oil reserve established you capitalise everything till then it would remain capital work-in process. Maximum amount of m oney is spent on exploration, technical scientific studies etc. Variable cost of production is low (Cairn India USD5-7/bl, Selan USD5-8/bl) The management is quite ethical so they have not capitalized till full discovery is established. Some oil companies start capitalising when they actually start production so only thing we can have is trust on mgmt.
The spend is of two types exploration well & production well. Exploration well takes more money than production as this is risky and requires drilling as well + chance of wastage of the drill hole itself.
Once discovery is established, production is not so capital guzzling and fixed cost is reasonably low. Completion of exploration & discovery could take 5-7 yrs at least.
Best way to value this kind of companies is EV/2P reserve. On that basis it trading at 1.1-1.3 while cairn india was sold 12 times. You can imagine the upside if everything goes well.
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‘The market always does what it’s supposed to — BUT NEVER WHEN’.
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Posted By: jamesvaikom
Date Posted: 04/Oct/2011 at 2:23pm
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The stock had given decent returns to investors in past. They are giving dividends for past few years. But problem is management is not transparent. They are not sharing much details in annual reports. If you look at annual reports of companies like cairn India you will get some idea of what they did and what the may be doing in future.
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Posted By: FutureBull
Date Posted: 04/Oct/2011 at 11:15pm
Yes it is a problem. I don't think there is any malafide intention here. They could definitely provide more info. in annual report. It is a good buy @250 levels. You would get decent returns even oil price doesn't go up.
Originally posted by jamesvaikom
But problem is management is not transparent. They are not sharing much details in annual reports. |
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‘The market always does what it’s supposed to — BUT NEVER WHEN’.
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Posted By: jamesvaikom
Date Posted: 04/Oct/2011 at 10:27am
@FutureBull
Operating profit of oil production is very high compared to other business. But we can't be 100% sure that they are doing business in honest way unless they show some transparency. They can argue that lack of transparency is due to security reasons. why can't they convince big fund managers. I don't think Porinju Veliyath can get more info about selan than LIC, Reliance etc.
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Posted By: subu76
Date Posted: 05/Oct/2011 at 7:38pm
Originally posted by FutureBull
Yes it is a problem. I don't think there is any malafide intention here. They could definitely provide more info. in annual report. It is a good buy @250 levels. You would get decent returns even oil price doesn't go up.
Originally posted by jamesvaikom
But problem is management is not transparent. They are not sharing much details in annual reports. |
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I'd think so....Somehow I feel a greedy a management would have atleast made some money by now by taking some huge loans from banks
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Posted By: FutureBull
Date Posted: 05/Oct/2011 at 11:26pm
The other issue in this industry is nobody wants to share too much info till actual profit starts flowing in. There are many vultures in this country who just want to snatch oil fields. Just think about the delay caused to the decision on Cairn-vedanta deal. some invisible hand (some say it was MDA) wanted the asset cheaper than Vedanta was paying. ultimately they paid with time and increased royalty.
There are many evidences to say that these guys are worldclass technocrats and honest. Just that they did not start with billions so they are creating value for everyone including for themselves. Knowledgeable ppl have confirmed me the claims about oil reserves that's why I got interested at the first place. Only thing I want to know the progress of drilling and status of those wells faster than they provide.
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‘The market always does what it’s supposed to — BUT NEVER WHEN’.
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Posted By: jamesvaikom
Date Posted: 05/Oct/2011 at 10:21am
Knowledgeable ppl have confirmed me the claims about oil reserves that's why I got interested at the first place.
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I think big fund managers also have enough knowledge. I am confused whether the problem is they don't trust management or they don't trust Govt..
Govt. should change policies either to help corporates or common man or both. But Govt's new policies are neither good for corporates nor common man. They are good only for politicians.
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Posted By: FutureBull
Date Posted: 05/Oct/2011 at 10:38am
the issue is not the reserves etc, the big problem is perceived risk, size of the organisation.. I just compare it with HOEC which got rerated 4-5 times in 2009 when reserve was established. The fund managers would not bet on non-producing oil company with 500cr mcap but fall over each other to get slice of Cairn/ONGC etc.
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‘The market always does what it’s supposed to — BUT NEVER WHEN’.
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Posted By: jamesvaikom
Date Posted: 06/Oct/2011 at 12:12pm
The fund managers would not bet on non-producing oil company with 500cr mcap but fall over each other to get slice of Cairn/ONGC etc.
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But selan is producing oil. Most oil exploration companies are drilling more wells than their current production wells. I don't think fund managers will wait till oil companies start production from all wells. Also PE of selan is less than other low debt high growth companies.
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Posted By: FutureBull
Date Posted: 06/Oct/2011 at 12:22pm
true but current production is more or less priced in but we are interested in what could be production 2-3 yrs down the line from the yet to be fully drilled reserves. Yes I do believe fund managers won't wait but tipping point not there yet. I don't think there is general consensus about the potential of the company. Technically, the stock looks strong though.
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‘The market always does what it’s supposed to — BUT NEVER WHEN’.
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Posted By: jamesvaikom
Date Posted: 06/Oct/2011 at 3:18pm
we are interested in what could be production 2-3 yrs down the line from the yet to be fully drilled reserves.
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No major oil companies are producing oil from all wells. Some wells will dry before they start production from other wells. They will start drilling new exploration and production wells before they start production from all existing wells. But production rate may increase in future. I also made decent profit from this stock in past. But now a days I am more comfortable with cairn than selan.
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Posted By: jamesvaikom
Date Posted: 14/Nov/2011 at 11:43am
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The stock outperformed market in last few years. But the stock is under-performing(at-least to cairn) after Q2 result. The stock is showing weakness when crude is showing some strength. I agree that we can't judge a stock with a quarterly result or stock movement of few weeks. But I still believe that there are some problems with transparency.
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Posted By: jamesvaikom
Date Posted: 04/Jan/2012 at 9:56am
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Promoters are selling even when crude oil price is high. Stay away from this company.
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