See Aban Offshore's FY10 EPS around Rs 120: BNP Paribas Sec

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See Aban Offshore's FY10 EPS around Rs 120: BNP Paribas Sec

In an exclusive interview with CNBC-TV18, Amit Shah, BNP Paribas Securities, talks about the Aban Offshore numbers and gives his outlook.

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ALSO READ News and Notices about Aban Offshore See interviews with Aban Offshore Management See what other Experts & Brokerages are saying about Aban Offshore See previous Results of Aban Offshore Aban Offshore BSE | NSE 31/05/12 Are Mutual Funds betting on Aban Offshore?

Aban Offshore has declared its third quarter results. The company's Q3 consolidated net profit was down at Rs 89.4 crore versus Rs 256 crore. Its consolidated net sales were up at Rs 841 crore versus Rs 837 crore.

In an exclusive interview with CNBC-TV18, Amit Shah, BNP Paribas Securities, talks about the Aban Offshore numbers and gives his outlook.

Here is a verbatim transcript of the exclusive interview with Amit Shah on CNBC-TV18. Also watch the accompanying video.

Q: Are you disappointed by the Aban numbers? What could have caused such a variance with the expectation on the net profit?

A: This is something which we even saw in the last quarter. We saw that the market penalise the stock simply because they reported perfectly inline quarter last time and this time I think it was slightly off by around 10%. So this has been my concern, which I have highlighted in the past, the consensus numbers are just way too high. It's a classic case of consensus being too high and the company disappointing rather than something structurally being wrong with the business.

Q: What was your own estimate in that case both for sales and profits and where did it fall short?

A: For sales, I was around Rs 9900 crore and on profit, I was at Rs 100 crore and some change.

Q: What do you think they will end the year with in terms of net profit and earnings per share now?

A: I think for earnings per share (EPS), they should do something in the range of around Rs 120, on a consolidated basis. Though I still haven't changed my number but what will happen is in the Q4 you will see Tahara coming on line as well Aban Pearl; they both have already commenced operations and Aban Pearl is high margin contract and high revenue as well. So as far as earnings and revenues are concerned, you will see good increase in Q4.

Also, the disappointment in this quarter was Middle Eastern contracts, which Aban had got, I haven't got a chance to confirm this with the management, but my initial take is they would not have performed for more than 30-35 days and that would again will be performing for atleast 80-day period in the Q4.