Great Offshore sets sail on leasing vessels overseas

Great Offshore rose 2.52% to Rs 273.10 at 11:29 IST on BSE, cutting previous session's losses, after the company chartered two of its vessels to an Egyptian firm for $22 million.
The company made the announcement during market hours today, 25 November 2008.
The stock hit a high of Rs 276.50 and a low of Rs 256 so far during the day. The stock had a 52-week high of Rs 1149.95 on 8 January 2008 and a 52-week low of Rs 200 on 18 November 2008.
The small-cap offshore oilfield services provider has an equity capital of Rs 37.14 crore. Face value per share is Rs 10.
The current price of Rs 273.10 discounts its Q2 September 2008 annualised EPS of Rs 18.18, by a PE multiple of 15.02.
In the previous session, the stock had ended 8.03% lower at Rs 266.40 on reports Great Offshore promoter Vijay Sheth, who is also the company's vice-chairman and managing director, was in talks with banks, financial institutions and even rival companies to raise funds to escape possible margin calls from lenders. However, Great Offshore, during market hours on Monday, 25 November 2008, had clarified that there was no change in the promoter shareholding, as per company's record since the last intimation sent in this regard dated 24 October 2008.
Creditors are reported to have been putting pressure on Sheth to clear his dues, but they are unlikely to sell the pledged shares to a strategic investor, suggest report.
Report further suggested that Sheth had almost finalised a deal with Bharati Shipyard, wherein the latter would give him money by purchasing his shares. This, however, was strongly denied by Bharti Shipyard managing director PC Kapoor.
Vijay Sheth hed pledged most of his 16% stake to IL&FS and Motilal Oswal in June last year. Sheth's outstanding is Rs 200 crore to IL&FS alone, while his outstanding to Motilal Oswal could be Rs 75-100 crore.
As per reports, the problem began when the lenders gave margin calls as the valuation of the collateral fell below the loan amount. This has put Sheth in a fix as he does not have more shares to put up as collateral.
Great Offshore was spun out of Great Eastern Shipping two years ago as part of the demerger between the Sheth family. Vijay Sheth, who runs the company, holds a 16% stake in Great Offshore, almost all of which is currently pledged to the lenders.
Post demerger, KM Sheth and Ravi Sheth, Sheth's estranged cousins, continue to be in charge of Great Eastern, the parent company. They also hold a 5% stake in Great Offshore. Vijay Sheth does not hold any significant stake in Great Eastern.
Great Offshore's net profit fell 66% to Rs 16.88 crore on a 4.6% rise in sales to Rs 159.34 crore in Q2 September 2008 over Q2 September 2007.
Great Offshore is an integrated offshore oilfield services provider, offering a broad spectrum of services to upstream oil and gas producers.