In a remarkable display of financial prowess, Oil and Natural Gas Corporation (ONGC) has unveiled its fourth-quarter results for the fiscal year 2023-24, showcasing a staggering 78% surge in consolidated net profit. This surge catapulted the company’s consolidated net profit to Rs 11,526.53 crore compared to Rs 6,478.23 crore in the same period last year. Sequentially, the net profit witnessed a marginal uptick from Rs 11,104.50 crore in the preceding quarter.
The state-owned oil and gas exploration major reported a marginal increase in revenue from operations for the fourth quarter, amounting to Rs 1.66 lakh crore compared to Rs 1.64 lakh crore recorded in the same period of the previous year. This steady growth underscores ONGC’s resilience amidst dynamic market conditions.
ONGC’s Board of Directors has proposed a final dividend of Rs 2.50 per equity share for the financial year 2023-24, subject to shareholder approval, signifying the company’s commitment to rewarding its stakeholders.
The robust financial performance is further echoed in ONGC’s earnings before interest, tax, depreciation, and amortization (EBITDA) for Q4, which surged to Rs 25,772 crore from Rs 15,752 crore during the corresponding period last year, showcasing a commendable operational efficiency.
However, contrary to market expectations, ONGC’s net profit was anticipated to decline over 11% year-on-year to Rs 8,434 crore, according to analysts’ estimates. Similarly, the company’s revenue for Q4 was expected to marginally decline by 1.11% to Rs 34,404 crore, with EBITDA forecasted to drop half a percent year-on-year to Rs 17,251 crore.
The anticipated decline is attributed to factors such as lower administered price mechanism (APM) gas price and reduced oil and gas production by ONGC, albeit partially offset by higher crude oil realization. Crude oil price realization from ONGC’s nominated fields stood at $80.81 per barrel for Q4, compared to $77.12 per barrel for the same period last year.
Despite challenges, ONGC exhibited resilience in its operational metrics. Total crude oil production witnessed a 2.4% increase year-on-year in Q4, reaching 5.359 million metric tonnes (MMT). However, the total oil production for FY24 experienced a slight decline of 1.6%.
Conversely, total gas production in Q4 witnessed a marginal decline of 3% at 5.101 BCM compared to the previous year. ONGC attributed this decline to various operational factors, as mentioned in its press release.
During FY24, ONGC declared 11 discoveries, with 6 in onshore and 5 in offshore locations. Among these, 6 are prospects and 5 are new pool discoveries, reflecting the company’s ongoing exploration and development efforts.
Notably, ONGC drilled a total of 541 wells during FY24, marking the highest recorded figure in the past 34 years. This included 103 exploratory wells and 438 development wells, underscoring the company’s proactive approach towards enhancing its production capabilities.
In terms of capital expenditure, ONGC invested approximately Rs 37,000 crore in FY24, compared to Rs 30,208 crore in the previous year, highlighting its sustained focus on bolstering its infrastructure and capabilities for future growth.
ONGC’s performance in the fourth quarter exemplifies its resilience and adaptability amidst a challenging operating environment, positioning the company on a trajectory of sustained growth and value creation for its stakeholders.
