ONGC slumps 5% after Q3 net profit sees 64% fall
Shares of ONGC, India’s largest oil and gas exploration and production company, slumped 5 per cent in Friday’s trade after the company reported a 64 per cent decline in December quarter earnings. This represents the second consecutive decline in quarterly profits as lower crude oil prices hurt the company’s earnings.
The company’s net profits for the quarter under review stood at Rs 1,286 crore against Rs 3,571 crore reported for the same quarter a year ago. Revenue fell marginally to Rs 18,547 crore from Rs 18,980 crore. The slump in the profit was on account of Rs 3,99 crore impairment loss provision.
Reacting to the earnings, the stock slipped 5.10 per cent to hit a fresh 52-week low of Rs 192.45 on the BSE. The stock has shed over 11 per cent of its value in last four sessions.
“Times are very bad for E&P (exploration and production) companies,” Chairman Dinesh Sarraf said, referring to the rout in oil. The company didn’t have to offer any discount to state fuel retailers this quarter, compared with Rs 9,458 crore a year earlier. This ensured it realised $44.34 for every barrel in the third quarter from nominated fields, compared with $35.52 a year ago, despite the collapse in oil price. The company’s realisation per barrel fell to $38.42 in December.