State run Oil and Natural Gas Corporation Ltd (ONGC)’s standalone net profit fell 6% to Rs 4,340 crore on account of higher expenses and the absence of a one-time gain seen in the corresponding quarter last year.
The company’s standalone profit for the March quarter was at Rs 4,340 crore, 6% lower compared to Rs 4624.3 crore reported in the same period a year back. In the same quarter, the company’s total income rose 29% to Rs 26233.56 crore from Rs 20297.83 crore in the corresponding quarter a year back. Total expenses, however, rose at a higher rate of 48% to Rs. 20696.46 crore from Rs 14022.15 crore a year back.
In addition, to higher expenses, the company’s standalone profit for the March 2016 quarter was also helped due to a one-time exceptional gain of Rs 389.82 crore.
ONGC chairman and managing director D K Sarraf said the company was able to report a good profit despite Rs 2,444 crore arrears that it took on its books for on account of royalty and Rs 1,944 crore on pay revision, primarily due to higher crude oil price. The net realisation was $54.91 per tonne in the quarter ending March 2017 as against $34.88 in the same quarter in 2015-16.
He said the company also gained from the first ever dividend from its subsidiary MRPL since 2011-12. Besides, there was impairment reversal of Rs 1,300 crore in 2016-17 out of Rs 3,200 crore write-off in 2015-16.
In a Bloomberg poll, 23 analysts estimated standalone revenue of Rs. 22827.1 crore and a standalone profit of Rs.5074 crore.
Segment-wise, the company’s offshore operations reported a profit of Rs 6413.87 crore. Losses for its onshore segment widened to Rs 1494.85 crore from Rs.119.22 crore reported in the same period a year back.
For the full year 2016-2017, the company’s consolidated net profit attributable to the owners of the company was 59.2 per cent higher at Rs 20,497.86 crore against Rs 12,875.21 crore in the same period a year back.
At its board meeting held on Friday, the company also recommended a Final dividend at Rs 0.80 per equity share of Rs 5 each, for the Financial Year 2016-17, subject to necessary approval of members at its annual general meeting.
GST impact: Sarraf said all oil companies were concerned on the implementation of goods and service tax. Crude oil, natural gas and certain downstream products were out of the purview of GST. “So while we will pay GST on inputs, we do not get credit on our output,” he said. The ministry of petroleum and natural gas has written on the issue to the ministry of finance. “But the issue is beyond the ministry of finance and is with GST council,” he said.