Essar Oil Ltd posted a decline of around 73 per cent in its fourth quarter net profit at Rs 180 crore as against Rs 660 crore reported in the corresponding previous quarter.

The net sales of the company during the last quarter of FY'10 stood at Rs 10,650 crore as against Rs 6,985 crore reported during same period last fiscal.

According to Naresh Nayyar, managing director of Essar Oil Ltd (EOL) "We saw refining margins bottoming out in the last quarter. With the margins improving this quarter, we are hopeful that the refining business is gradually coming out of the doldrums,".

Meanwhile, for the fiscal ended March 2010, Essar Oil has reported net profit of Rs 29 crore as against net loss of Rs 514 crore in the previous one.

However, the results for 2009-10 are not comparable with those of the previous year, as the company started commercial production from its Vadinar refinery in Gujarat's Jamnagar district, effective from May 2008.

The turnaround came about despite profit dropping from the Rs 660 crore in the fourth quarter ended 2008-09 to Rs 180 crore in the fourth quarter of 2009-10.

Moreover, the net sales during the last quarter of 2009-10 stood at Rs 10,650 crore as against Rs 6,985 crore in the same period in the previous fiscal.

Meanwhile, Essar Oil is tripling the capacity of its refinery at Vadinar in Gujarat to 34 million tonnes by the end of 2010.

On the top of this, the company as part of its strategy to achieve a total refining capacity of a million barrels a day, is scouting for acquisition of a refinery overseas.

However, Essar Oil also announced that its Vadinar refinery expansion plans were on track with its March 2011 mechanical commissioning target for the 18-mt (million tonnes) per annum expansion project. Along with this, it has also received Rs 2,000 crore of equity contribution from promoters and has tied up the entire Rs 4,600-crore of debt for expansion of the refinery.

Essar Oil is currently trading at Rs.146.5, down by 1.74% at 12.16 PM on BSE.

The stock hit an intraday high of Rs.150.8 till now, as against the 52-week high of Rs.194.The stock hit a low of Rs.144.2 during the day. The stock had hit a 52-week low of Rs.117 on July 13, 2009.

The stock opens at Rs.147 at BSE. The total traded volume of the scrip on BSE till now stood at 1097783.

Meanwhile today, the BSE Sensex is trading up by 59.72 points, or 0.34% , at 17881.68 on 12:16 PM.

The NSE Nifty is trading up by 18.00 points, or 0.34% , at 5340.95.

Essar Oil has an equity capital of Rs 1,202.00 crore as of 2009 Dec. The face value per share is Rs 10. At the current price of Rs 146.5, the P/E multiple stood at 0 with book Value of 28.91 and P/BV at 5.07.

The total shareholding pattern of the company as on Dec 2009 stood at Promoters- 18.14%, Institutional Investors- 4.37%, General Public- 5.31% and other investors- 72.18%.

Considering the current price of Rs. 146.5 at 12:16:00 PM , the stock had outperformed the market over the past one month till 15/04/2010 surged 3.35% as compared to the Sensex's return of 2.87% and NSE Nifty's 2.87 % returns.

Considering the current price of Rs. 146.5 at 12:16:00 PM , the stock had underperformed the market over the past one quarter till 15/04/2010 declined 4.4% as compared to the Sensex's return of 1.36% and NSE Nifty's 1.36 % returns.

Meanwhile, Essar Oil plans to lay a 160-km pipeline from Durgapur to Kolkata in order to transport gas from its CBM blocks to consumers in West Bengal.

Essar Oil has applied to the sectoral regulator, Petroleum and Natural Gas Regulatory Board (PNGRB) in order to allow to lay a 24-inch pipeline from Durgapur, as per the company's January 13 application to the regulator.

The company is likely to commence the production of gas found below coal seams, called Coal Bed Methane (CBM), from its Raniganj block in West Bengal this quarter.

The initial output is likely in the range of 9,000-10,000 cubic meters per day with peak production of 3.5 million standard cubic meters envisaged in mid-2013.