ONGC dips after weak crude prices hurt Q3 net

Provision for impairment of assets for December 2015 stood at Rs 2,612 crore

Oil and Natural Gas Corporation reported 64% drop in net profit at Rs 1,285 crore for the December 2015 quarter, because of slide in global crude oil prices and provisioning for impairment of assets. Net profit for the same quarter last year was Rs 3,571 crore.

“Our profit would have been Rs 3,898 crore, had it not been for the provision for impairment of Rs 2,612 crore,” ONGC Chairman and Managing Director D K Sarraf said.

The sharp decline in global crude oil prices resulted in lower gross realisations. Gross realisations decreased to $44.34 per barrel in the December 2015 quarter from $75.97 per barrel in the year-ago period.

However, with the government having exempted ONGC from sharing the subsidy burden of downstream oil firms in the third quarter, net realisation ($44.34 per barrel) was higher than the net realisation of $35.52 per barrel of the corresponding quarter of 2014-15.

The stock opened at Rs 200 and touched a low of Rs 191. At 11:50am, over 3.2 million shares were traded on both the stock exchanges.