About Nayara Energy (Formerly Essar Oil) Limited Unlisted Shares

History of Essar Oil

Essar Oil was part of the Essar Group based out in Mumbai before it was acquired by Rosneft a Russian Company. Essar Oil has Private Petrol Pumps, operates the second-largest refinery in Gujarat, India, and 1000-MW power plant along with the Vadinar port and oil terminal. In October 2016, Russia state-owned oil company, Rosneft bought a 49% stake in Essar Oil, along with Russian investment fund United Capital Partners in a deal worth $12.9 billion. Other investors include Trafigura and UCP Investment Group. They renamed the company to 'Nayara', coined from "Naya" (New) and "Era", in May 2018. After the acquisition of 49.13% stake by Rosneft and another 49.13% by Trafigura and UCP Investment Group, the new owners of Essar Oil aim to scale up the company’s petrol pump network to 6,000 outlets in India from 3,500 now.

Delisting of Essar Oil

Essar Oil was delisted in 2015-16 and the final delisted price of Essar Oil was discovered by the reverse book-building process at ₹262.80 . To complete the process, Essar Oil has paid ₹3,745 crore to shareholders who tendered their shares. The company received bridge financing of $330 million from Russia’s VTB Bank to fund the payout.

About Nayara Energy (Formerly Knows as Essar Oil)

Nayara Energy (formerly known as Essar Oil) is an integrated downstream oil company of international scale encompassing the entire hydrocarbon value chain from refining to production and marketing, across segments, including retail. In 2016 Essar Oil was acquired by Rosneft, the world’s largest public oil and gas company by liquid hydrocarbon production and reserves and an investment consortium led by global commodity trading firm Trafigura & UCP Investment Group. Essar Oil has since been renamed as Nayara Energy.

Milestone after the Acquisition:

1. The company after being acquired by New Management Raised INR 2,400cr (c. US$ 355mn) through its placement of nonconvertible debentures in 2018.

2. Local credit rating1 upgraded by three notches to “AA”.

3. Refinancing of INR Debt for optimization of capital structure.

FY19-20 Business Performance Retail Business

1. The Retail segment yet again delivered a stupendous performance in FY 2020. The year over year volume growth was 18% against the industry’s year over year volume growth of 1%.

2. This year they have added 574 new petrol pumps. With 574 new outlets added last fiscal year, Nayara Energy stood at 5,702 fuel stations at the end of FY 2020 with a pan-India presence.

Supply and Distribution

1. The Company continues to focus on improving domestic supply infrastructure and hired a coastal terminal at Mangalore and Ennore for ensuring supply at Karnataka and Tamil Nadu.

2. It also commenced supplies from Bina and Kanpur hospitality locations to improve local product availability in Madhya Pradesh and Uttar Pradesh respectively.

3. Commissioned in 2019, the Company’s rail-fed Wardha depot uniquely caters to Nayara Energy’s retail outlets as well as product requirements from other oil companies in and around the Vidarbha region of Maharashtra. The Company finalized another rail-fed smart automated depot in Pali, which is expected to be completed by 2021.

4. Nayara Energy did the complete conversion of its own locations to BSVI grades in January 2020, ahead of the mandatory guidelines.

Institutional Business

1. Right channeling in priority markets resulted in increased sales for Petcoke. The Company also augmented new geographies of Orissa and Nepal for the Petcoke supply.

2. The Company recorded the highest-ever Sulphur sales in a year since the inception of the refinery and re-entered the Bitumen business after moving out last year.

FY19-20 Financial Performance

1. Revenue from operations was at ₹ 1,00,641 Crores for the financial year ended March 31, 2020, as compared to ₹1,00,313 Crores for the financial year ended March 31, 2019.

2. Current Price Gross Refinery Margin (CP GRM) was lower at USD 5.88/bbl in FY 2019-20 as against USD 6.97/bbl in FY 2018-19.

3. Total Debt has been reduced from 17566 Crores in FY19 to 10757 Crores.

4. D/E Stands at 0.55x.

5. Trade receivables have also come down from 3689 Crores to 1270 Crores. This has helped Nayara Energy to clocked 12612 Crores of Cash-flow from operations.