Oil & Natural Gas Corporation (ONGC), India's state-owned oil explorer, reported a 17.8% decline in its standalone net profit for the second quarter ended September 30, as lower crude oil prices impacted its revenue.

Financial Performance

ONGC's standalone net profit fell to ₹9,848.00 crore in Q2, compared to ₹11,984.00 crore in the same period last year. The company's revenue from operations also decreased by 2.5% to ₹33,031.00 crore from ₹33,881.00 crore year-on-year.

The company's earnings before interest, tax, depreciation, and amortization (EBITDA) declined by 8.1% to ₹20,023.00 crore from ₹21,791.00 crore in the same quarter of the previous year.

Operational Highlights

Despite the challenging market conditions, ONGC maintained its production levels. The company's crude oil production for the quarter stood at 4.630 million metric tonnes (MMT), showing a marginal increase of 1.2% compared to the same period last year.

Natural gas production remained relatively stable at 4.918 billion cubic meters (BCM), compared to 4.920 BCM in the corresponding quarter of the previous year.

Dividend Announcement

The Board of Directors has declared an interim dividend of ₹6.00 per share (120% on the face value of ₹5.00 each). The total payout for this interim dividend will amount to ₹7,548.00 crore.

Future Outlook

ONGC continues to focus on its exploration and production activities. The company has announced production targets of 21 million tonnes of oil and 21.5 billion cubic meters of gas for FY27, as shared by a company executive.

While the lower oil prices have impacted ONGC's financial performance in the short term, the company remains committed to its long-term growth strategy and maintaining its position as India's leading oil and gas explorer.

About ONGC

Oil and Natural Gas Corporation Limited (ONGC) is India's largest crude oil and natural gas company, contributing around 71% to Indian domestic production. The company has a significant presence in the entire hydrocarbon value chain, including exploration, production, refining, and marketing of oil and gas products.

Oil & Natural Gas Corporation (ONGC) reported an 18% year-over-year increase in standalone net profit for the second quarter ended September 30, 2023, driven by higher oil and gas prices. The state-owned oil explorer also declared an interim dividend of ₹6 per share and recently entered into a strategic partnership with Japan's Mitsui O.S.K. Lines Ltd. for ethane transportation.

Financial Performance

Segment Performance

The offshore segment continued to be the major contributor to ONGC's revenues and profits, accounting for nearly 70% of total revenue.

Strategic Joint Venture Development

ONGC signed Joint Venture Agreements and Capital Contribution Agreements with Mitsui O.S.K. Lines Ltd. (MOL), Japan, to subscribe equity shares in two joint venture entities - Bharat Ethane One IFSC Private Limited and Bharat Ethane Two IFSC Private Limited, both registered in Gift City, Gandhinagar.

Each joint venture company will own and operate one Very Large Ethane Carrier (VLEC) under the Indian flag, deployed for transporting ethane from the United States to meet feedstock requirements of ONGC Petro additions Limited (OPaL).

Dividend Declaration

The ONGC board declared an interim dividend of ₹6.00 per equity share (120% of face value) for FY 2023-24. The total payout amounts to ₹7,548.00 crore, with the record date set as November 14, 2023.

Other Strategic Investments

ONGC approved an investment of up to ₹421.50 crore in its wholly-owned subsidiary ONGC Green Limited, demonstrating the company's commitment to renewable energy expansion. The ethane shipping venture aligns with the Maritime Amrit Kaal Vision 2047, emphasizing national self-reliance and maritime infrastructure development.