Q4FY21 Result Preview - Oil & Gas - ICICI Direct

Global crude oil prices have risen from February onwards in Q4FY21 and reached pre-Covid levels. Brent crude oil prices, on a closing basis, also jumped US$11.2 QoQ to US$62.4/bbl on account of extended output cuts by Opec+. Subsequently, even average crude oil prices sharply increased by US$16.1/bbl to US$60.7/bbl. Hence, net realisations of upstream companies are expected to increase sharply QoQ.

CGD volumes to grow YoY, albeit on lower base

Sales volume of city gas distribution (CGD) companies with higher CNG contribution is expected to increase in the range of 5-6% YoY on a lower base as demand in last week of March 2020 was affected by nationwide lockdown. CGD companies with higher industrial PNG contribution recovered faster and will report stronger growth. Domestic PNG sales volume will remain steady. CGD companies' realisation is expected to increase QoQ as all companies hiked prices to pass on increase in costs. Gross margins for CNG-heavy companies are expected to remain higher YoY due to low gas prices. On a QoQ basis, margins are expected to remain flattish. For large gas utility companies, volumes are expected to be flattish/slightly lower YoY given reduced LNG imports during the quarter.

For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_OilGas_Q4FY21E.pdf

Source : Equity Bulls

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