Nayara Energy, India’s largest private fuel retail network, has appointed a new chief executive officer (CEO) after its previous CEO, Alessandro Des Dorides, resigned last week.
Sergey Denisov, who has been with Nayara since 2017, has been appointed the new CEO of the company. He was previously its chief development officer.
Operating and owning a significant 20 million-tonne-a-year oil refinery at Vadinar in Gujarat, as well as over 6,750 petrol pumps, Nayara Energy is backed by Russian oil giant, Rosneft, which owns 49.13 per cent stake in the company.
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It has been sailing in troubled waters after the EU hit the company with sanctions directed at Russia for its war with Ukraine and approved by the EU last week to weaken Russia’s revenue sources.
Des Dorides resigned soon after, although the company did not offer any immediate comments on the reasons or circumstances under which the CEO resigned.
Des Dorides had joined Nayara Energy, formerly Essar Oil Ltd, in April, 2024, amidst controversial circumstances after having been sacked by Italian oil company Eni S.p.A, where he was head of oil trading.
In 2019, the Italian oil company bought a shipment of oil that was purported to have come from Iraq, but actually came from Iran. The act potentially breached the US sanctions and led to Des Dorides, who oversaw the deal for the cargo, being fired.
Meanwhile, the EU’s sanctions have been strongly condemned by both Nayara and Rosneft, who termed them unjust, illegal, and a direct threat to India’s energy security. Nayara said it was studying legal options against the sanctions.
Besides Rosneft, an investment consortium SPV, Kesani Enterprises Company, holds another 49.13 per cent stake in Nayara. Kesani is owned by Russia's United Capital Partners (UCP) and Hara Capital Sarl, a wholly-owned subsidiary of Mareterra Group Holding (formerly Genera Group Holding S.p.A.).
Despite the sanctions, Nayara says it continues to operate at healthy throughput and refining margins levels in a steady state scenario.
CARE Ratings Ltd (CareEdge Ratings) reaffirmed ratings on bank facilities and debt instruments of Nayara, saying the firm derives strength from its strong operating profile as it operates India's second-largest single-location oil refinery with a high Nelson Complexity Index (NCI), strategic location of its refinery and captive port terminal and power plant, long-term benefits from sizeable and growing presence in fuel retailing and recently commissioned manufacturing of polypropylene.
Ratings continue to factor risk management systems put in place by Nayara to hedge against fluctuations in currency, crude oil prices and product cracks; while its presence in the retail segment provides stability to the company's profitability and mitigates the impact of fluctuations in the refining segment, CareEdge Ratings said in a statement.
"However, rating strengths are tempered by economic sanctions imposed on Rosneft Oil Company (Rosneft; one of the key shareholders of Nayara) amidst ongoing Russia-Ukraine conflict, exposure to fluctuations in fuel cracks, competitive industry scenario and inherent government regulation risk in the Indian oil and gas sector," it said.
The rating agency said it "takes note of the recent sanction by the European Union (EU) on Nayara Energy Ltd (NEL) for export of its products to the EU".
The agency also predicted that Nayara would continue to remain a strong player in the private sector oil refining business in India with healthy refining margins, considering the high complexity index of its refinery and integrated options, which, CareEdge Ratings said, should help it to maintain its strong profile.
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