ONGC reports staggering 565% growth in Q2 net profit

New Delhi, Nov 13: State-owned oil and gas explorer Oil and Natural Gas Corporation (ONGC) on Friday reported 565 per cent year-on-year growth in its standalone net profit to Rs 18,348 crore for the second quarter period ending September 2021, a sharp jump over expected profit growth of just over Rs 6,000 given by analysts.

The ONGC had reported standalone net profit of Rs 2,758 crore in the July-September quarter of FY21.

The rise in Q2 profits has come largely on account of decrease in deferred tax liability of the company by Rs 8,541 crore and decrease in current tax by Rs 1,304 crore by opting for lower tax regime during the quarter with newer provisions getting implemented from FY21.

The oil explorer’s revenue from operations also jumped 44 per cent year-on-year to Rs 24,353.6 crore in Q2, FY22 against a revenue of Rs 16,916 crore in the same quarter of previous year.

The company’s operating margin in the quarter sharply expanded to 48.17 per cent from 32.78 per cent in the year-ago aided by an increase in global crude oil prices.

Shares of ONGC ended 0.9 per cent higher at Rs 154.8 on the National Stock Exchange.

The company board also approved interim dividend of 110 per cent, i.e. Rs 5.50 on each equity share of Rs 5.

The total payout on this account will be Rs 6,919 crore. The record date for distribution of dividend has been fixed for November 23, 2021.

During the quarter, ONGC’s crude oil production fell 2.9 per cent to 4.676 million tonne from the previous year level of 4.818 million tonne.

The production of crude oil and gas has declined during the current year mainly due to restrictive conditions created by cyclone Tauktae and due to Covid impact.

Further delay in mobilisation of MOPU Sagar Samrat to WO-16 Cluster project impacted production from this field, the company said in a statement.