ONGC - Q4FY13 Result Review - Angel Broking

ONGC reported lower than expected 4QFY2013 profitability performance due to higher operating costs. The company's top line increased by 13.6% yoy to Rs. 21,388cr (above our expectation of Rs. 19,938cr). The company's crude oil production volumes declined 1.8% yoy to 6.47mn tonnes while gas volumes stood at 6.2bcm. The company shared a subsidy burden of Rs. 12,310cr in 4QFY2013. The company's EBITDA decreased by 7.3% yoy to Rs. 10,731cr. Depreciation expenses grew by 76.9% yoy to Rs. 2,387cr which resulted in net profit declining by 39.9% yoy to Rs. 3,389cr (below our expectation of Rs. 4,172cr). The company has notified two new gas discoveries in KG basin deepwater field. The company estimates a potential gas reserve base of 4.85TCF from these fields.

We maintain our accumulate view on the stock with a target price of Rs. 354.

Source : Equity Bulls

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