Buy Shiv-Vani and Selan Exploration: Avinash Gorakshekar

In a chat with ET Now, Avinash Gorakshekar, Head of Research, Anagram Capital Ltd., talks about oil exploration stocks.

Do you like anything from the oil exploration stocks?

Within the oil exploration space, we like Shiv-Vani and Selan Exploration. Typically both these companies have got very good kind of contracts lined up with ONGC. More importantly with crude oil prices ruling high, there is a very strong possibility that oil rigging rates for these rig operators would obviously continue to be up. More importantly Selan as well as Shiv-Vani, our sense is that earnings growth are going to be pretty strong. In fact for Shiv-Vani, we have an earnings kind of growth expectation of roughly about 25% for FY11 and around 20-22% for FY12, so at this level, Shiv-Vani definitely looks attractive. If an investor buys in at current price, we are looking at a target price of close to about 370-380, which should give a decent amount of return and with crude prices likely to remain strong for a pretty long period, we feel that the ancillary players operating in this space would obviously do well.