Alphageo - Creating Seismic Waves


(Raj) #147

Alphageo AR 2017 out.


(lohiyaakshay08) #148

Any idea what management is thinking to go into?





(Mridul) #149

They said they are interested in Aerial geographic surveys. Nothing concrete on this front yet.

I think mgmt is prudent and is doing what they should be doing. As the ONGC project is now stable, they are looking beyond this … as to how to maintain this growth trajectory post 2019. They have the cash flows as well now to explore new verticals.

I also see them entering different geographies (countries) in seismic surveys in near future.


(lohiyaakshay08) #150

Where I can find this? Is this in annual report?

BTW thanks


(chikspat) #151

Last quarter results!


(Nolan) #152

This can be looked upon either ways - half glass full or half glass empty. Till there is clarity on future orders and the nature of diversification, it would be difficult to say which way the story is heading.

On the positive side, the company still has time till the ONGC order ensures future cash inflow. Also, the company has gained much experience in handling big projects and has demonstrated good capability. This should help them in future.

On the negative side, depleting order book and no new orders is definitely a concern. Add to that, the company is still focusing on putting up the machinery in place for the building blocks stage, where fresh ideas would be explored. What these ideas would be, how they get implemented and when they’ll taste success are all questions anyone can take a long shot at. Similarly, geographic diversification is not very easy as the transition from being a local player (primarily) to a global players in a tough market with established competitors will have its own challenges

The prices currently have somewhat factored in these risks and have also discounted the excellent growth in last few quarters as the order book depletes.

Disc: Tracking postion


(Mridul) #153

Best part is …they have 2 years to figure this out. Stock might languish until new orders come in.


(msprabhu) #154

They have already clarified that they will not be bidding for new orders till the current order of ~1200 cr is serviced. They have stated the following “We believe that the goodwill arising out of the competent conclusion and closure of the contracts will strengthen our credentials in getting more contracts – better to engage in less work completed with competence than be thinly spread and weaken our respect among customers.”


(chikspat) #155

Read the last line where they mentioned they participated in a tender for aerial geophysical services.


(nil_71) #156

Market is looking for earning growth and Order visibility. We need to consider as Specialized IT service company.

Will Market not punish mid-sized ones in case they mention Pipeline is poor. We need to consider that way. Existing stuff already priced in


(Tanveer) #157

Read current year Annual report


(chikspat) #158

(Tarun) #159

Initially this official release left me perplexed and wondering if there are any U turns from the switch from NELP to HELP since this HELP policy appeard to be more pragmatic and market force driven:

However, with little digging seems that today’s announcement affirms the continued commitment and resolve towards the same policy and actually an incremental step towards the vision.

My sum-total understanding:

  1. GOI via DGH had 7 proposal of 107,386 LKM of 2D Data extraction under OLAP till last year.
  2. ONGC was assigned 40,835 LKM of 2D in 18 states in 2016
  3. OIL was assigned 7,408 LKM in North East in 2016
  4. Today’ announcement finalized another 48.243 LKM 2D data from the remaining part of the unassigned work.
  5. With that major chunk of work assignment is done except ~10,900 LKM from the entire OLAP.

Good news for AlphaGeo in the sense that:

From the previous work assigned to ONGC it won contact worth 1300 Crs for 26,905 LKM and ~102 Crs from OIL. Considering the pole position and proven capability the prospect will be very bright for AlphaGeo to emerge as a competitive bidder, shall they choose to participate in the bid for ONGC/OIL work again.

Also, the books looks little better considering the projected cash flow from existing ~1400 Cr. order work which is on track to be completed by Q3,FY19. Blessing in disguise, the delay in assigning this recent work will work in their favor since the existing B/S would not have allowed them to take any more work a year back.

These are my thoughts basis quick reading of todays notification and limited available information. Eagerly looking for more detailed info.

Disc:

  • Invested since last 9 months. Few transactions post that, whenever opportunity was apt.
  • This was testing patience but positive that old school value/MOAT thinking still holds true.

Tarun


(chikspat) #160

Hi,
I did not go in details yet, but if Alphageo not bid for this tenders, WHAT else they can do? Most probably they will bid to keep their market leader position in seismic surveys. If new tender awards and work has to be start in 2019, as tarun said, NO or MINIMUM CAPEX, that will be fantastic. For winning of orders this is last man standing, as other players do not have enough experience or money to perform such large orders. If they win orders revenue visibility will be approximately up to 2023. Now a days FMCG also have difficulty have such long visibility, if hope market do not ask more visibility on lighter tone.

Disc: Invested since last year. Accumulated little today also!


(Raj) #161

I don’t think this assumption is correct. There are quite a few Indian like Quippo(Srei Infra subsidiary), Globe, Advent oilfields besides Asian oilfields. There are Russian, Polish and US based companies as well.

Regards,
Raj
Disc: Invested since last one year


(Anand Srinivasan) #162

Few quick notes from Asian oil field services. They seem to be oil India ltd favorites winning about 1100 cr worth projects…
Also they seem to have wireless seismic survey. Not sure if alphageo has this technology

Nevertheless it is certain that full order book is not going to a single player. Key turnaround should be winning foreign orders.

Invested and keeping fingers crossed.


(RICHAJ) #163

I haven’t gone through the AR in detail, but briefly read that the plan is to gradually diversify to synergistic niche businesses. Does anyone have any insight into what these areas might be?


(chikspat) #164

http://www.offshoreenergytoday.com/tag/seismic/

Came across above link, where seismic survey are plenty in world. If Alphageo successfully ventured in international market, then there will be no concerns for future visibility. This visibility issue really testing once capacity to hold stock when there is nothing negative in company.

Disc: Invested since last year


(Kunal Parikh) #165

No To Oil Exploration In Manipur
http://kanglaonline.com/2017/08/no-to-oil-exploration-in-manipur/


(Raj) #166

I asked Asian Oilfield management about this article as they are the one doing seismic survey in Manipur. MD smiled and said, we are moving ahead smoothly. This is part and parcel of a democratic system.

Regards,
Raj
Disc: Invested in Alphageo, no trading in last 6 months.