Q1 Results: ONGC’s Profit Misses Estimates Despite High Oil Prices

Oil and Natural Gas Corporation Ltd.'s profit for the quarter ended June missed analyst estimates even though global crude prices rose and the rupee depreciated.

Standalone net profit rose 4 percent sequentially to Rs 6,144 crore in the April-June period, the state-run oil explorer said in an exchange filing. That compares with the Rs 6,697 crore consensus estimate of analysts tracked by Bloomberg.

Revenue increased 13.5 percent over the previous quarter to Rs 27,213 crore in the three months ended June. Analysts had estimated Rs 26,947 crore.

The Asian benchmark Brent crude oil prices rose 13 percent during April-June, averaging at about $75 a barrel compared with $67 in the previous quarter.

Operating profit rose 29.43 percent to Rs 14,732 crore. Margin rose to 54.14 percent from 47.49 percent in the previous quarter.

ONGC's other income fell 82.6 percent to Rs 650 crore from the previous quarter. It had received dividends from Hindustan Petroleum Corporation Ltd. and Indian Oil Corporation Ltd. in the previous quarter. Tax paid during the quarter also rose 49 percent to Rs 3,463 crore.

The stock closed 0.4 percent lower, ahead of the results announcement, compared to a 0.9 percent drop in the benchmark S&P BSE Sensex.

Other Highlights

• Crude production flat at 6.22 MMT.
• Gas production up 2 percent to 6.2 BCM versus 6.077 BCM.
• Crude sales down 1.7 percent to 5.8 MMT versus 5.9 MMT.
• Gas sales up 2.2 percent to 4.9 BCM versus 4.8 BCM.

From The Conference Call

• No pressure of reducing debt on books, not looking to monetise stake in listed entities.

• Reduced debt to Rs 16,670 crore as of August 1 from Rs 25,000 crore.
• If oil prices stay in current range, there won't be any subsidy burden.

(Corrects an earlier version that stated operational performance missing estimates)