ONGC (Q2 FY14)

India Infoline News Service | Mumbai |

Oil and Natural Corporation Ltd (ONGC) reported 12.7% yoy increase in net sales to Rs224bn (including income from operations), highest since Q2 FY12.

CMP Rs269, Target Rs330, Upside 22.7%
  • Net sales rise 12.7% yoy driven by higher production of oil from JV fields and rupee depreciation causing higher realizations for gas and oil

  • Discount on crude oil increased from US$63.05/bbl to US$64.17/bbl

  • Natural gas realization was at Rs9,404/tscm v/s Rs8,655/tscm in Q2 FY13

  • For H1 FY14 upstream contribution towards under recoveries is at 52.5% and ONGC share among upstream companies is at 82.5%

  • We maintain our BUY rating with a 9-month target price of Rs330 as steep discount to global peers in EV/BOE terms more than adequately factors in the risk of higher subsidy and possibilities of limited gas price hike

Result table
(Rs m)
Q2 FY14
Q1 FY13
% yoy
Q4 FY13
% qoq
Net sales
224,147
198,851
12.7
193,089
16.1
Purchases (Trading)
(8)
(7)
7.1
(10)
(26.5)
Raw material
(1,188)
(35)
3,303.7
(774)
53.4
Personnel costs
(4,427)
(5,449)
(18.8)
(5,897)
(24.9)
Statutory levies
(58,242)
(55,853)
4.3
(55,720)
4.5
Other overheads
(39,248)
(33,820)
16.0
(45,803)
(14.3)
Operating profit
121,036
103,687
16.7
84,884
42.6
OPM (%)
54.0
52.1
186 bps
44.0
1,004 bps
Depreciation
(44,973)
(37,274)
20.7
(39,007)
15.3
Interest
(1)
(31)
(97.1)
(2)
(57.1)
Other income
14,830
19,011
(22.0)
11,961
24.0
PBT
90,891
85,394
6.4
57,836
57.2
Tax
(30,254)
(26,429)
14.5
(17,677)
71.2
Effective tax rate (%)
33.3
30.9
30.6
PAT
60,638
58,966
2.8
40,160
51.0
PAT margin (%)
27.1
29.7
(260) bps
20.8
625 bps
Ann. EPS (Rs)
28.4
27.6
BSE 182.85 [1.60] ([0.87]%)
NSE 183.00 [1.35] ([0.73]%)

***Note: This is a NSE Chart

 

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