MOSL: ONGC (Buy)-EBITDA in-line-gas production to get a fillip
ONGC: EBITDA in-line; gas production to get a fillip
(ONGC IN, Mkt Cap USD22.6b, CMP INR128, TP INR175, 36% Upside, Buy)
- Net sales declined 2% YoY to INR265.5b in 1QFY20 due to lower crude oil realization of USD66.3/bbl. EBIDTA of INR151.1b (+3% YoY) was in line with our estimate, supported by lower expenditure (USD6.3/boe v/s USD7.8 in 1QFY19). Tax rate came in higher than expected at 34.8%. The company reported its first-quarter earnings based on Ind-AS 116, the impact of which on PBT is a loss of INR1b. PAT was down 4% YoY at INR59.0b, led by higher depreciation.
- DD&A stood at USD9.8/bbl (v/s USD8.2 in 1QFY19).
- Net realization was at USD66.3/bbl (v/s USD74.2 in 1QFY19) with no subsidy burden during the quarter.
- Royalty stood at INR32.5b (12.2% of sales), as against INR33.8b (12.4% of sales) in the year-ago period.
Oil and Natural Gas is engaged in exploration, development and production of crude oil and natural gas. Co.'s business also includes niche areas like -processing of crude oil & natural gas; oil field services, transportation of the oil and natural gas, production of value added products like - LPG, Naphtha, Superior Kerosine Oil, ATF, C2-C3, etc., Refinery, Petrochemicals, Power, unconventional and alternate sources of energy. Co.'s five international locations as per oil & gas production are in Vietnam, Russia, Venezuela, Sudan, South Sudan, and Colombia. Co.'s five international locations as per oil & gas reserves are in Russia, Venezuela, Sudan, South Sudan, Myanmar and Vietnam.
Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.
Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.
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