Driven by higher net realisations and a sharp depreciation in currency, Oil and Natural Gas Corporation (ONGC) on Thursday reported a 65 per cent year-on-year (YoY) increase in profit to Rs 8,262.70 crore.
The stock, which closed Thursday’s session down 1.12 per cent at Rs 132.10, is among the biggest underperformers. Since 2018, it has given up over Rs 80,000 crore in market capitalisation. In March 2018, the national explorer paid around Rs 37,000 crore to acquire a government stake in HPCL.
ONGC’s realisation from crude oil from its nominated fields increased 13.6 per cent per barrel in dollar terms and 26.5 per cent in rupee terms during the December 2018 quarter compared to the year-ago period.
The company has, in the last two quarters, gained because of higher crude oil prices. While oil price crossed $85 per barrel in early October, it saw a sharp correction for a few days, but has remained above $60 during most of the period.
The YoY jump in profit was also boosted by higher revenue from offshore operations which was up 19.1 per cent.
Revenue from operations was up 20 per cent to Rs 27,694.09 crore during the December 2018 quarter against Rs 22,995.88 crore during the year-ago period.
The company’s written-off cost for exploratory increased by 79 per cent YoY and 120 per cent sequentially to Rs 2,388.42 crore during the quarter.
The national explorer is under stress to increase its activities in order to increase production as NITI Aayog has recommended 118 small fields, which contributes 6 per cent to the countries total production, with ONGC and Oil India from the nomination era be taken away and auctioned off. —FE