Oil and Natural Gas Corporation

ONGC reported lower than expected performance for the quarter ended December 2011 with 11% fall in topline to Rs 18517.13 crore compared to corresponding previous year period and 5% fall in bottomline to Rs 6741.41 crore over the same period. Topline fell 11% inspite of Rs 627 crore included in Q3FY'12 sales with regard to royalty paid by ONGC for Rajasthan block being eligible for cost recovery for period October 2011 to December 2011. Further an income of Rs 3142 crore received from Cairn India towards Royalty paid for the period August 2009 to September 2011 has been disclosed as an exceptional item. Fall in topline was mainly due to tripling of subsidy sharing. ONGC gave a subsidy discount of Rs 12536 crore in Q3FY'12 compared to Rs 4222 crore in Q3FY'11 up by 197%. This impacted the PBT by Rs 10616 crore and PAT by Rs 7172 crore. Total subsidy burden shared by ONGC for 9MFY'12 is at a staggering Rs 30296 crore compared to Rs 12757 crore for 9MFY'11

OPM fell 530 bps to 59.7% leading a 18% fall in operating profit to Rs 11050.88 crore as staff as a percentage of adjusted net sales rose to 2% from 1%, statutory levies rose to 21% from 19.6% and other expenditure rose to 17% from 14%. Other income rose 43% to Rs 958.17 crore. Interest cost being negligible (fell 66% to Rs 1.86 crore) DDA (Depreciation, Depletion and Amortization) cost rose 24% to Rs 4531.96 crore mainly due to rise in dry well expenditure. PBT before EO fell 29% to Rs 7475.23 crore. The company had an EO income of Rs 3142 crore in relation to amount received from Cairn India towards Royalty paid for the period August 2009 to September 2011. PBT after EO rose 1% to Rs 10617.31 crore. Effective tax rate rose to 37% from 33% and considering prior period items net profit fell 5% to Rs 6741.41 crore.

ONGC post discount oil realization was down 31% to $44.96 per barrel for Q3FY'12 compared to $ 64.79 per barrel in Q3FY'11 after giving a discount of $66.77 per barrel during Q3FY'12.

Average rupee vs USD fell to Rs 51 in Q3FY'12 from Rs 44 in Q3FY'11 resulting in 21% decline in net realization of crude oil in rupee terms compared to 30% decline in dollar terms. Net realization in rupee terms was Rs 2293 per barrel compared to Rs 2906 per barrel in Q3FY'11.

ONGC crude oil production fell 4% to 6.74 MMT from 7.03 MMT in Q3FY'11. This includes 5.96 MMT from domestic operations and 0.78 MMT from JVs. ONGC gas sales rose 1% to 6.4 BCM in Q3FY'12. This includes 5.86 BCM from domestic operations and 0.54 BCM from JVs. Total Value added production rose 4% to 0.801 MMT from 0.78 MMT in Q3FY'11

For nine months ended December 2011 ONGC reported a 9% increase in topline to Rs 57844.41 crore compared to corresponding previous year period while its bottomline rose 21% to Rs 19478.54 crore. ONGC gave a subsidy discount of Rs 30296 crore compared to Rs 12757 crore in 9MFY'11, up by 137%. ONGC post discount oil realization was up to $58.61 per barrel for 9MFY'12 compared to $58.72 per barrel in 9MFY'11 after giving a discount of $57.63 per barrel during 9MFY'12.

ONGC made 5 new discoveries during Q3 of 2011-12 and one more in October'11 totaling 20 discoveries so far in this fiscal.

The Board of Directors had declared an interim dividend of Rs 6.25 per share (125%) amounting to Rs 5347.18 crore in its meeting held on January 04, 2012 which has since been paid.

The scrip is currently trading at Rs 280.

ONGC: Standalone Results