| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | n/a | n/a |
| Intrinsic value (DCF) | n/a | |
| Graham-Dodd Method | 0.01 | -95 |
| Graham Formula | n/a |
Scirocco Energy Plc (LSE: SCIR) is a UK-based energy company focused on oil and gas exploration, development, and production, with strategic assets in Europe, Africa, and the Americas. The company holds significant interests in key projects, including a 25% stake in the Ruvuma Petroleum Sharing Agreement in Tanzania, an 8.39% interest in the Kiliwani North Development License, and a 4.29% interest in the Helium One license. Formerly known as Solo Oil Plc, the company rebranded to Scirocco Energy Plc in 2020 to reflect its diversified energy strategy. Operating in the high-risk, high-reward oil and gas exploration sector, Scirocco Energy targets undervalued assets with growth potential. Despite its small market cap, the company aims to leverage its portfolio to capitalize on global energy demand. With headquarters in Leeds, UK, Scirocco Energy remains a speculative play in the energy sector, appealing to investors seeking exposure to emerging oil and gas opportunities.
Scirocco Energy Plc presents a high-risk, high-reward investment opportunity in the volatile oil and gas exploration sector. The company reported no revenue in FY 2022, with a net loss of £4.68 million and negative operating cash flow, reflecting its early-stage project focus. However, its portfolio, including stakes in Tanzanian assets, offers potential upside if exploration succeeds. The lack of debt and £750,000 in cash provide some financial flexibility, but further capital raises may be necessary. With a market cap of just £2.03 million and a beta of 0.834, Scirocco is a micro-cap speculative play, suitable only for risk-tolerant investors. The absence of dividends and reliance on asset development make this a long-term, binary bet on exploration success.
Scirocco Energy Plc operates in a highly competitive and capital-intensive industry dominated by larger players with stronger financial resources. Its competitive advantage lies in its niche focus on undervalued exploration assets, particularly in Tanzania, where it holds strategic interests in the Ruvuma and Kiliwani North projects. However, the company lacks the scale and diversification of major oil and gas firms, making it vulnerable to project-specific risks. Its small size allows agility in acquiring non-core assets from larger competitors, but funding constraints limit its ability to develop projects independently. Scirocco’s partnership with Helium One adds a unique element to its portfolio, differentiating it slightly from pure oil and gas explorers. The company’s success hinges on successful exploration and favorable regulatory environments in its operating regions. Without production revenue, it remains highly speculative compared to established E&P firms with cash-generating assets.