Cairn Oil & Gas Secures 7 New Blocks in OALP Round IX, Expanding Portfolio to 69 Blocks and Strengthening Position as India's Largest Private Oil Producer
With a PE ratio of 13x, the company trades at a discount compared to the industry PE of 16.3x. The company has ROCE of 20.9 per cent and ROE of 10.5 per cent.
Vedanta Limited's Cairn Oil & Gas, India's largest private oil and gas producer, has secured seven new blocks in the Open Acreage Licensing Policy (OALP) Round IX auction. This acquisition increases Cairn's portfolio to 69 blocks, covering approximately 73,000 square kilometers. The newly acquired blocks include four onshore and three shallow water blocks located in the Cambay, Saurashtra, and Mumbai hydrocarbon basins. Cairn holds a 100 per cent participatory interest in all OALP blocks, reinforcing its position as the largest private player in the auction by securing seven out of 28 blocks.
The Vedanta Group Chairman, Anil Agarwal, praised India's hydrocarbon policies, stating they provide 'tremendous opportunity and returns on capital.' The strategic expansion of Cairn is in line with the company's plan to make a 50 per cent contribution to the domestic crude production of India. The company has been actively participating in OALP auctions, previously acquiring 36 blocks in Round-I, five in Round-II, and three in Round-III. Cairn's commitment to unlocking India's hydrocarbon potential is seen in the fact that it has planned to invest in increasing oil and gas exploration and production on the West Coast.
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Vedanta Limited is a diversified natural resources company that deals with the exploration, extraction, and processing of minerals and oil & gas. The company operates across various segments, including aluminium, zinc, lead, silver, copper, oil & gas, power, and iron ore. In the aluminium segment, Vedanta is India's largest primary producer with a 46 per cent market share. The zinc, lead, and silver segment includes a 65 per cent stake in Hindustan Zinc Ltd, which holds a 75 per cent market share in India's primary zinc market.
The company's oil and gas business is conducted through Cairn India which is the largest private oil and gas exploration and production company in India. The company is expanding its alumina refinery and smelter capacities and undertaking significant projects in zinc and power sectors. The company's strategic priorities are to achieve zero carbon emissions by 2050 and increase its social impact through the Anil Agarwal Foundation. The company demerged into six separate listed entities in September 2023.
Vedanta Limited has a market capitalisation of Rs 148,712 crore. The company has delivered a 1-year return of 6.81 per cent, while its 3-year return stands at -7.03 per cent. The price-earnings (PE) ratio is 8.33, reflecting a relatively low valuation. One of the major public shareholders of the company is PTC Cables Private Limited, holding a 1.91 per cent stake. Additionally, the company has been maintaining a healthy dividend payout of 235 per cent, indicating its commitment to returning value to shareholders.
In the Quarterly Results of December 2024, the company reported a revenue of Rs 39,115 crore, reflecting a YoY growth of 10.06 per cent compared to Rs 35,541 crore in December 2023. The operating profit stood at Rs 11,104 crore, marking a 30.16 per cent increase from Rs 8,531 crore in the same quarter last year. The profit after tax (PAT) surged by 76.20 per cent to Rs 3,547 crore from Rs 2,013 crore in December 2023.
In FY24, the company posted a revenue of Rs 1,43,727 crore, registering a decline of 2.43 per cent compared to Rs 1,47,308 crore in FY23. The net profit for the year stood at Rs 4,239 crore, down 59.91 per cent from Rs 10,574 crore in the previous financial year.
With a PE ratio of 13x, the company trades at a discount compared to the industry PE of 16.3x. The company has ROCE of 20.9 per cent and ROE of 10.5 per cent.
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Disclaimer: The article is for informational purposes only and not investment advice.