ONGC slips over 2% post Q4 results; higher operating cost weighs

NEW DELHI: ONGC slipped over 2 per cent in morning trade on Thursday, a day after the state-run company reported 40 per cent decline in its March quarter net profit due to higher operating costs, fall in oil & gas output and higher provisioning.

At 09:50 a.m., ONGC was trading 1.5 per cent lower at Rs 329.35. It hit a low of Rs 326.30 and a high of Rs 330 in trade today.

ONGC paid Rs 49,421 crore subsidy to state-run fuel retailers for selling diesel, kerosene and cooking gas below market rates, which was more than 11% higher compared to previous fiscal year.

The company’s crude oil production volumes declined 1.8 per cent YoY to 6.47 mn tonnes while gas volumes stood at 6.2bcm. The company's EBITDA decreased by 7.3 per cent YoY to Rs 10,731 crore.

“Depreciation expenses also grew by 76.9 per cent YoY to Rs 2,387 cr which resulted in net profit declining by 39.9 per cent YoY to Rs 3,389 crore,” Angel Broking said in a report.

“The company has notified two new gas discoveries in KG basin deepwater field. The company estimates a potential gas reserve base of 4.85TCF from these fields,” added the note.

Angel Broking maintained its ‘accumulate’ rating on the stock with a 12-month target price of Rs 354.