ONGC on Wednesday reported a surprise 3 per cent rise in the second-quarter profit as rupee depreciation boosted earnings and helped counter record subsidy payout.
Net profit in the July-September quarter rose to Rs 6,063.86 crore compared to Rs 5,896.57 crore in the year-ago period,chairman and managing director Sudhir Vasudeva said. Oil and gas production has been flat and our net realisation has been lower due to subsidy payout. It is only rupee depreciation which saved the day, he said.
The higher profit breaks a sequence of four consecutive quarters of lower net profit. ONGC bills its oil and gas consumers in dollars and a depreciation in rupee adds to its revenues. The company paid Rs 13,796 crore to subsidise diesel,LPG and kerosene in the second quarter as opposed to Rs 12,330-crore payout in the same period last fiscal.
Our net realisation has been coming down and in H1 it was $42.56 per barrel. We need net crude price of $60 per barrel to be able to fund Rs 35,000 crore plus of annual capex plans, said Vasudeva.
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