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Essar Energy - India (ESSR)     

HARRYCAT - 23 Jul 2010 14:56


July 2010 - Market Cap of £6bn ; Founded in 1969.
Floated on the LSE in May 2010
Indian parent Company Essar Group comprising Essar Oil & Gas, Essar Power.
Specialising in power generation & oil & gas operations in India

aldwickk - 28 Feb 2012 09:44 - 45 of 101

India-based resources firm Essar Energy continued to slide, the biggest blue chip casualty of the day with a fall of 3.5p at 104.1p. Goldman Sachs today downgraded Essar from buy to neutral and slashed its target price from 190p to 134p.

HARRYCAT - 28 Feb 2012 10:07 - 46 of 101

Deutsche summary note:
FY results reflect challenges on funding position, project execution, and fuel sourcing. We reduce our target price to 250p/share and retain a HOLD recommendation. Reflecting its tight position in terms of capital, Essar suggested it may not contribute in an Essar Oil capital raising and may reduce its ambition around power projects. Although there have been some positive signs on government attempts to resolve issues on fuel sourcing, there remains a high degree of uncertainty in the short-term.
Essar reported numbers slightly behind expectations with current price adjusted EBITDA of $624.8m (DB forecast $678m, last year $696.5m). Essar said that it may not participate in any Essar Oil capital raising, and may reduce its ambitions in power to reflect limited capital flexibility, and problems around finalizing approvals for some projects. Although these tough decisions should provide more headroom for the group, and make refinancing attempts for Essar Oil and Energy easier, we have updated our valuation to reflect potential value loss from these decisions.

hlyeo98 - 03 Mar 2012 13:48 - 47 of 101

Capital concerns for Essar Energy

The share price of Essar Energy dipped once more after it was revealed that a faltering rupee and a legal reversal by India's Supreme Court had combined to scupper full-year headline figures for the India-focused refiner and power generator.

Essar's profits were hit by a net charge of $656m (£413m) after the Indian court ruled against it over a matter relating to deferred state sales tax. Essar is seeking a judicial review of the decision, but a provision of $1.14bn was included in the balance sheet to reflect the potential liability to the state of Gujarat. Essar also suffered from the rapid weakening in the rupee last year, prompting a $303m foreign-exchange loss.

Even if you exclude these factors, Essar's cash profits of $625m (£394m) still came up short of consensus estimates, and were 10 per cent down year on year. A positive note was provided by a one-fifth hike in Essar'’s Indian refining and marketing revenues, while the key Vadinar refinery expansion remains on target.

The Gujarat decision, together with a 60 per cent rise in underlying net debt to $5.7bn, has prompted Essar to review its capital commitments. It has already reassessed three power projects – Salaya 2 & 3 and Neptune 1 – while giving notice that it may not participate in a proposed capital raising by its subsidiary Essar Oil.

aldwickk - 04 Mar 2012 08:50 - 48 of 101

Telegrapgh extract :

The average price target of the seven City analysts monitored by Bloomberg is 217p – almost double the current share price.

Should the regulatory issues in India, relating to forest clearing, be resolved and a new share issue at India-listed subsidiary Essar Oil, go well, then there is plenty of upside.

However, the Indian situation could drag on for some time, so it is one to avoid until the situation becomes clearer. However, bold investors may wish to have a small holding in the speculative part of their portfolio.

cynic - 04 Mar 2012 09:57 - 49 of 101

not if you have any sense!
have you ever tried getting something even heard in the indian courts?

midknight - 04 Mar 2012 11:42 - 50 of 101

Telegraph/Questor link for full article:

aldwickk - 04 Mar 2012 15:35 - 51 of 101

Quester v seven City analysts ...... and the winner is ?

Cynic i think Essar would carry more clout in Indian courts then you would , lol

cynic - 04 Mar 2012 16:52 - 52 of 101

all one can say about indian courts - which thankfully i have never had to explore - is that they will be (marginally) less corrupt that the pakistani courts

HARRYCAT - 13 Mar 2012 10:49 - 53 of 101
Essar Oil has successfully commissioned the diesel hydrotreater unit 1 (DHDT-1) as part of the phase I expansion at its Vadinar refinery in India.

Essdar Energy - which own 87.1% of Essar Oil - says this leaves just three units remaining to be commissioned as part of the Vadinar expansion, which is firmly on track to be completed by the end of this month. The phase I expansion involves the addition of nine new units altogether.

These will expand the refinery's capacity to 18 million metric tonnes per annum (or 375,000 barrels per day) and will enhance the refinery's complexity to 11.8 from 6.1 currently. With this commissioning, Essar Oil's capital expenditure programme is beginning to taper downwards.

The refinery expansion will deliver a substantial pick-up in revenues and profitability of the company going forward.

aldwickk - 19 Mar 2012 18:28 - 54 of 101

Woozle1 - 19 Mar'12 - 17:31 - 638 of 640

This is worth potentially a lot more than 150. It's forecast to do earnings next year of 25-30p, as three power stations will be substantially completed during H1 2012 and that 2013 will see the full year benefit of this capex. Management have said that the capex will be scaled back until they get approvals for the coal mining operations (and in the meantime they aren't paying duties on imported fuels) and which means the free cash yield on the shares should increase substantially. Applying a p/e of 15, once investors have bought back into the Indian power story, values the business between 375 and 450.

cynic - 19 Mar 2012 21:00 - 55 of 101

so a realistic p/e of say 5 indicates an sp of 125/150 assuming full valuation

aldwickk - 22 Mar 2012 07:47 - 56 of 101

Essar Energy (ESSR) announced that as part of its 1.8 billion dollar (1.1 billion pound) Phase I expansion plan it has commissioned its new sulphur recovery and vacuum gasoil hydrotreating units at its Vadinar refinery in India. The project will increase capacity at the plant to 375,000 barrels per day, and the only part left to complete is the delayed coker unit, which it expects to come online in a matter of days. Essar shares crept up 0.4p to 149.3p.

HARRYCAT - 29 Mar 2012 12:23 - 57 of 101
Essar Energy has announced that Essar Oil has completed the $1.81bn expansion of its Vadinar refinery in India with the successful commissioning of the Delayed Coker Unit (DCU), the final unit to be completed.

Vadinar, in Gujarat state, is now India's second largest single-location refinery, with an annual capacity of 18 million metric tonnes per year (MMTPA), or 375,000 barrels per day (bpd), up from 14.7MMTPA/300,000 bpd previously. The refinery also now has a complexity of 11.8, up from 6.1 previously, which makes it among the world's most complex refineries.

The capacity expansion and complexity enhancement gives the Vadinar refinery the capability to process a much greater proportion of lower cost heavy and ultra heavy crude oils. The proportion of ultra heavy crude, previously around 20% of the total, will go up to 60% and the combined share of heavy and ultra heavy crude will go up to 80%.

The company has already entered into long-term crude sourcing contracts with global crude suppliers, including several national oil companies from Latin America.

Essar Oil is targeting export markets such as Australia, New Zealand and north-west Europe, in addition to other countries in the Indian subcontinent. However Essar Oil will continue to market a majority of its products in the domestic market.

Prashant Ruia, interim chairman of Essar Energy, said: "We are delighted to announce the completion of the refinery expansion programme. This expansion will greatly improve our product offering, margins and competitiveness. Our capital expenditure programme is now nearing an end. We have invested close to $5bn to date in the refinery complex and our cost per complexity barrel is one of the lowest in the industry."

HARRYCAT - 04 Apr 2012 08:08 - 58 of 101

April 4, 2012: Essar Energy plc [LSE: ESSR], the India-focused integrated energy company, today announced that commercial operations have now begun at the 600 megawatt (MW) unit 1 of its 1,200MW Salaya I power project.

Unit 2 at Salaya I, also of 600MW, has been synchronised with the transmission grid and is expected to begin commercial operations in the coming weeks.

The coal fired Salaya I project is located in Gujarat state and is being built at a total investment cost of $1.1 billion. Most of the power produced will be sold to the Gujarat state electricity utility, GUVNL, under a long term contract.

Salaya I is one of three power projects due to be commissioned by Essar Energy in 2012, the others being the 1,200MW Mahan I project and the 510MW Vadinar P2 project. Together these three projects will add 2,910MW to the existing capacity of 1,600MW and will take Essar Energy's total installed capacity to 4,510MW.

Naresh Nayyar, the chief executive officer of Essar Energy, said: "The commissioning of the first unit at Salaya is another major milestone for Essar Energy and we are also making good progress at our Mahan I and Vadinar phase 2 projects. These projects combined will add 2,910 megawatts to our generating capacity and will improve our revenues and profitability."

aldwickk - 11 Apr 2012 08:42 - 59 of 101

Sold some of my CEY and bought more ESSR , can't find any new's why ESSR has moved up this morning when Asian market's are down.

HARRYCAT - 26 Apr 2012 14:40 - 60 of 101
Essar Energy subsidiary Essar Oil Ltd has renewed a major product sale and purchase agreement with Bharat Petroleum Corporation.

The renewed four-year agreement, running up to 2016, is for the supply of diesel, petrol, kerosene and aviation turbine fuel to BPCL from Essar Oil's Vadinar refinery.

It also entitles Essar Oil to purchase products from BPCL and gives the two companies the option of sharing each other's distribution infrastructure. Essar Oil chief executive, marketing, S Thangapandian, said: "We are delighted to further cement our long-term relationship with BPCL.

"Essar Oil has emerged as the biggest supplier for fuels for BPCL. With our expanded capacity coming on stream, we are fully geared to serve the growing demands of high quality fuel for the nation."

dreamcatcher - 26 Apr 2012 18:33 - 61 of 101

Theres one for you Harry, get reading now and you might be finished by opening bell tomorrow. Long one. lol

aldwickk - 26 Apr 2012 18:42 - 62 of 101

Very nice

dreamcatcher - 26 Apr 2012 18:43 - 63 of 101

You can tell Harry all about it then aldwickk .lol

jimmy b - 30 Apr 2012 11:35 - 64 of 101

Bouncing back nicely on not a great day ..
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