MOSL: ONGC (Buy)-PAT miss led by higher write-offs
ONGC: PAT miss led by higher write-offs
(ONGC IN, Mkt Cap USD31b, CMP INR172, TP INR197, 15% Upside, Buy)
- 4QFY19 net sales were ~7% higher than our estimate at INR267.6b (+12% YoY), primarily due to higher oil sales. But, EBIDTA was ~9% lower than our estimate at INR123.7b (+9% YoY) due to higher expenditure. Opex stood at USD8.9/bbl (v/s USD9.8 in 4QFY18 and USD5.7/bbl in 3QFY19). PAT at INR40.4b (-46% est., -32% YoY) was led by higher DD&A at USD13.2/bbl in 4QFY19 (v/s USD10.9/bbl in 4QFY18 and USD9.1/bbl in 3QFY19).
- For FY19, total EBITDA/PAT were up 34% YoY at INR594.6b/INR267.2b. The impairment charge of INR15b relates to two assets of OVL - block 5A in South Sudan and Imperial. Royalty was higher at INR42b (~48% YoY) due to higher JV expense on account of pre-NELP block. For full-year FY19, royalty stood at INR134.6b (+36% YoY).
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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