Offshore companies make it big on bourses

Offshore companies are buzzing on bourses backed by surge in crude oil prices.

The upstream companies are gaining ground even as crude oil price rise may pose a challenge to Oil importing nations like India.

Aban Offshore, Selan Exploration, HOEC, Dolphin Offshore are all up on Monday by anywhere between 4.8 per cent to 12.4 per cent on an intraday basis.

Aban Offshore trading at Rs 265 per share is up by Rs 14.65 per share or 5.86 per cent; Dolphin Offshore trading at Rs 137.20 per share is up by Rs 15.25 per share or 12.47 per cent; HOEC trading at Rs 72.75 per share is up by Rs 3.35 per share or 4.83 per cent; and Selan exploration trading at Rs 203.75 per share is up by Rs 12.65 per share or 6.62 per cent on an intraday basis.

Over a period of one year HOEC has been the top gainer, and has clocked up 125 per cent, followed by Aban Offshore which is up by 31 per cent for the same period.

Selan exploration has delivered negative returns of 4.4 per cent in one year; whereas Dolphin Offshore has generated returns in excess of 19 per cent for the same period.

The rise in crude oil prices has triggered an interest in these stocks as these companies fall in the upstream oil sector, which is also commonly known as the exploration and production (E&P) sector.

Rising crude oil prices augur well for these upstream sector companies. The sector includes searching and drilling exploratory wells; searching for potential underground crude oil; and finally bringing the crude oil to the surface.

Crude Oil price  is trading close to $55 per barrel, approximately 30 per cent higher than what it was trading one year ago, and has inched up by almost 96 per cent from its lows of $ 27.82, made in the month of January, 2016.