Oil And Natural Gas Corporation Ltd. share price target

Reduction in material costs and other expenses aided growth in EBITDA (+64.1% YoY to Rs. 11,282cr). Resultantly, PAT also rose 144.6% YoY, further helped by lower D&A; and interest costs. With sharp recovery in crude oil prices in FY21, we expect the segment to witness further growth in coming quarters. Upward revision in Gas prices and any improvement in demand scenario should boost the performance further. Therefore, we reiterate our BUY rating on the stock with a revised TP of Rs. 145 based on SOTP valuation....

Note: LP : Loss to Profit, PL : Profit to Loss ONGC reports Q4 profit at Rs 6,734 crore, realisation increases 18.4% Oil & Natural Gas Corpn consolidated net sales increased 9.38% to Rs 114168.26 crore in Q4FY21 compared to Q4FY20. Operating profit margin has jumped from 3.39% to 13.56%, leading to 337.62% rise in operating profit to Rs 15,477.87 crore. Raw material cost as a % of total sales (net of stock adjustments) decreased from 21.89% to 18.20%. Purchase of finished goods cost fell from 43.49% to 37.30%. Employee cost decreased from 1.60% to 1.09%. Other expenses rose from 29.60% to 30.34%. Selling and administration expenses rose from 13.11%...

ONGC reported in line crude oil sales (-4% YoY), while gas sales continue to be lower than our estimate (-6% YoY). Lower opex led to beat on EBITDA (8% higher than our estimate at INR101b). ONGC almost reached FY20 production levels for crude oil, while the decline in gas production is due to lesser offtake by customers due to the COVID-19 outbreak. This resulted in a production shortfall in VAP as well. Oil/gas production in FY21 was 22.5mmt/22.8bcm, totaling 45.3mmtoe. The company expects FY22 production at 48.7mmtoe, with oil/gas production at...

We increase our earnings estimates by 35%/33% to factor rise in crude oil prices of USD65/70/bbl for FY22/23E. Global crude oil prices recently increased sharply as OPEC countries cut production, while demand recovers from recent pandemic. However as OPEC + countries increase their supplies and Iran sanctions get lifted, prices will likely come off. ONGC stock...

ONGC's Q3FY21 revenue and EBITDA was in-line with our estimates, while PAT was below our estimates on the back of higher than expected tax rate and lower other income. Oil/Gas production volume declined 3%/6% YoY to 5.6mmt/5.8bcm. Effective tax rate came at 51% while other income was also down by 13% YoY to Rs12 bn. The company is forming a 100% subsidiary for natural gas/LNG sourcing and marketing. Along with the group companies ONGC needs 2.5-4mmt of natural gas. It expects production volume from KG basin to averge 3.4mmscmd in FY22 and 8.5mmscmd in FY23 and peak production of 15mmscmd to reach in FY24. We expect US$2.6/...

ONGC Q3 Sales down 8%, NP down 47%, misses estimates ONGC reported 8% decrease in its topline to Rs 100288.83 crore in Q3FY21 compared to corresponding previous year period. OPM fell to 11.2% from 14.3% leading to 28% fall in operating profit to Rs 11279.36 crore. Other income of the company rose 21% to Rs 2127.68 crore. Interest cost fell 33% to Rs 1025.2 crore. Depreciation (includes Depletion, Amortization and impairment losses) cost decreased 13% to Rs 6494.8 crore. PBT was down 30% Rs 5887.4 crore. Tax expenses were down 48% to Rs 2012.02 crore. Net profit reported was down 14% to Rs 3875.02 crore. Further considering MI and share of profit...

ONGC's Q3FY21 EBITDA at Rs 65bn (47% YoY) underperformed estimates owing to higher operating costs.

We increase our earnings estimates for FY21E to factor rise in global crude oil prices given production cuts by OPEC countries and similarly for FY22/23 to factor in lower cost. Global crude oil and gas prices will likely remain weak given uncertain demand environment plus new supplies may come in Mar-21 when production cuts get reviewed; accordingly, we factor in USD45/55/bbl...

While crude oil prices are witnessing sequential improvements, supported by volume growth from Hazira plant and KG98/2 project in long-run. Hence we upgrade our rating to BUY on the stock with revised target price of Rs. 86 using SOTP valuation....

ONGC's Q2FY21 EBITDA at Rs 84bn (36% YoY) outperformed estimates on account of lower operating costs.