ONGC Ltd Q3 net up 4-fold yoy at Rs10,932cr on 75% improvement in dollar realization per barrel

12 Feb 2022 , 12:20 PM

ONGC Ltd reported 57.28% yoy growth in total sales revenues for the Dec-21 quarter on consolidated basis at Rs126,818cr, net of excise. On a sequential basis, the revenues were up by 19.29%.

During the December 2021 quarter, the total crude oil production at 5.451 MMT was -3.2% lower on a yoy basis. The total gas production for the quarter at 5.564 BCM was also lower by -4.2% on a yoy basis.

The output of value added products also saw a fall of -5.7% at 763 KT. The fall in the production of crude oil and gas during the quarter was due to restrictive conditions created by Cyclone Tauktae and COVID related restrictions.

ONGC has declared 3 new discoveries of which 2 are inland and 1 is offshore. The sales were higher despite lower volumes on account of much better realizations as we shall see later.

For the Dec-21 quarter, the operating profits were up 144.62% at Rs15,599cr. The company also witnessed 24.51% growth in operating profits on a sequential basis. ONGC saw 3-fold increase in operating profits in offshore E&P and a sharp turnaround in onshore E&P, thanks to better realizations.

The refining and marketing business saw flat to lower operating margins and even the operating profits from the international operations of ONGC Videsh more than doubled in the quarter. In terms of realizations, the dollar realization per barrel improved in the quarter by 75.3% from $43.20/bbl in the Dec-20 quarter to $75.73/bbl in the Dec-21 quarter.

Even the gas price realization improved by 62% yoy from $1.79/mmbtu to $2.90/mmbtu. Operating margins improved from 7.91% in Dec-20 quarter to 12.30% in the Dec-21 quarter on operating profit pressures. However, the operating margins were just about 51 bps higher on a sequential basis.

Net Profit after tax (PAT) for the Dec-21 quarter was up 334.12% yoy at Rs10,932cr on the back of superior operating performance getting transmitted to the bottom line.

However, the sequential profits were sharply lower by -39.5% but that was largely on account of deferred tax writebacks of Rs8,715cr in the Sep-21 quarter, which is a one-time inflow and hence not exactly comparable.

PAT margins improved from 3.12% in the Dec-20 quarter to 8.62% in the Dec-21 quarter. The PAT margins were sharply lower on a sequential basis due to the exceptional one-time deferred tax credit in Sep-21 quarter.

Financial highlights for Dec-21 compared yoy and sequentially

	ONGC Ltd
Rs in Crore	Dec-21	Dec-20	YOY	Sep-21	QOQ
Total Income (Rs cr)	₹ 1,26,818	₹ 80,630	57.28%	₹ 1,06,307	19.29%
Operating Profit (Rs cr)	₹ 15,599	₹ 6,377	144.62%	₹ 12,529	24.51%
Net Profit (Rs cr)	₹ 10,932	₹ 2,518	334.12%	₹ 18,055	-39.45%
Diluted EPS (Rs)	₹ 8.69	₹ 2.00		₹ 14.35
Operating Margins	12.30%	7.91%		11.79%
Net Margins	8.62%	3.12%		16.98%