Hindustan Oil Exploration Company Ltd | Digging up great profits | Investing | Share Market | Share Guru |
It is the first private sector venture in the oil & gas exploration. This company has been operating nine oil fields of confirmed reserves. They are located at Northeast (2), Gujarat (3), Western region (2) and Eastern region (2). Being a debt-free entity, it can mobilise funds required for expansion through internal accruals. In the third quarter of 2018-19, the production increased to 9,050 barrels of oil equivalent per day compared to 8,942 in the prior quarter. Production at B18 oil field will commence in the first quarter of 2020-21. The company aims 5,300 barrels of oil production per day on a net basis in 2019-20. Its plan is to enhance it further to 8,000 barrels a day from 2020-21. The realised average price per barrel is 60 Dollars. The government allowed it to sell natural gas at 3.66 Dollars from October 2018 to March 2019.
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In the quarter ended December 2018, the standalone net profit jumped to Rs 34.77 Cr from Rs 12.86 Cr in the corresponding period of the earlier year.
The net profit in the first nine months ended December 2018 rose to Rs 100.88 Cr, as against Rs 21.35 Cr in the year-ago period. This nine months net is more than the 12 months profit of Rs 37.67 Cr. The company reported an EPS of Rs 7.74 for the first three quarters. It is a debt-free company with an operating capital of Rs 166 Cr of which the cash portion comprises Rs 107 Cr. The share of the company traded between Rs 165 and Rs 98 during the 52-week period. At the current market price of around Rs 105, it is an attractive buy.