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OAO sitting at R0.24 is comedy if you look at what they're pulling from upstream. Nigerian exposure is the real play here, not the SA retail stuff everyone fixates on. Comparing to Sasol at these levels is pointless, different beast entirely. Hold if you've got the stomach for it.
OAO's been stuck in the doldrums but the upstream assets in the Gulf of Guinea are legit, just need oil to stay above 70 a barrel to make sense. At R0.24 you're basically getting the downstream retail for free which is mental. Nigerian energy plays are rough but if they sort the naira weakness it could rerate hard against peers like Sasol.
OAO sitting at R0.24 is basically free money if the upstream stuff actually scales, but that's a big if when you're fighting Nigerian politics and rand weakness. Refining margin compression is real though, downstream won't save you. Catch the express train or wait for better entry, not much in between.
OAO up 8.7% to 25c is decent action, but we need to see what's driving this. Energy stocks have been volatile lately so unless there's something concrete on upstream production or refining margins, I'm treating this as a relief bounce until proven otherwise.
Nigerian exposure and rand weakness is a real headwind but the upstream assets still have legs if oil holds above 70. Compare to Sasol, also got hammered but fundamentals there were actually broken. OAO's issue is sentiment and currency, not the business model itself. Long-term view hasn't changed.
The Nigerian upstream exposure is what's got people spooked, but Brent's holding up and their downstream refining footprint actually benefits from rand weakness. At R0.23 you're getting the retail fuel network almost for free compared to what Sasol trades on, and that's before you factor in their exploration upside in the Gulf of Guinea. Positioned perfectly for when sentiment shifts on African oil.
Oil and gas in Nigeria is a game of politics and rand moves, OAO gets both ways. At R0.23 you're pricing in either a miracle or a funeral, hard to tell which yet. If the naira stops being a punching bag and they sort out the refining side, could be something there, but thats two massive ifs.
Nigeria's energy story should be stronger than this valuation suggests, but do you think the rand weakness actually helps or hurts when most of their cash flows are naira-denominated. Not sure how much of their earnings even make it back to SA shareholders at this point.
OAO sitting at R0.23 is tough to ignore if you believe in the energy play, but Nigerian exposure and rand weakness are real headwinds. The downstream side keeps the lights on but upstream is where the real money is and that's lumpy as anything. Rather watch how they handle capex over the next year than chase it here on sentiment.
lol oao at 23c is rough but the upstream assets in nigeria still have legs if oil holds up. downstream is the real drag tho, refining margins are squeezed everywhere. think the rand weakness actually helps them convert naira revenue back but need to see the next quarterly numbers to know if managements actually doing anything about the cash burn.
OAO sitting at R0.23 is pricing in some serious distress, but the upstream production assets in Nigeria are still there. Problem is the downstream refining side keeps bleeding cash and the rand weakness kills rand-based earnings. Would need to see either a hard exit from the refinery or oil prices staying north of 80 bucks for this to rerate.
OAO sitting at R0.23 is mental given what they're pulling from upstream and downstream ops across west africa. ngl the rand weakness helps on conversion but nigerian exposure is sketchy as hell with cbdc shenanigans. if they can keep production steady and retail fuel margins dont get crushed, long term thesis still there but short term punting this feels loose.