By Newscript News Network
August 22, 2025
Oil and Natural Gas Corporation (ONGC) began FY26 with strong operational momentum. Consolidated net profit rose 18.2% to ₹11,554 crore, backed by a high-intensity drilling programme—578 wells in FY25, the most in 35 years—yielding nine new hydrocarbon discoveries across Mumbai Offshore, the Krishna-Godavari basin, and onshore plays. Output nudged higher: standalone crude oil rose 1.2% to 4.683 MMT, while gas held at 4.846 BCM.
Near-term monetisation levers are already in play. The PY-3 joint venture field has restarted production and CBM Bokaro’s North Karanpura block began gas sales in May 2025, contributing more than ₹1,700 crore in revenue at a premium $8.26/mmbtu—~20% above APM. Diversification continues with a ₹39.42 crore helium recovery demonstration plant in Tamil Nadu via EIL—early exposure to critical materials.
Strategically, ONGC has 21 major projects worth ₹65,389 crore under execution, while its technology partnership with BP aims to revitalise mature assets such as Mumbai High. The medium-term production glidepath depends on discovery conversion, decline management, and faster cycle times.
Market Sentiment & Investment Detail:
Shares at ₹237.26 (−0.44% intraday) are down ~27% YoY despite improving fundamentals. Valuation remains undemanding at around 8.32x PE and 0.8x PB. Street stance skews positive: of 28 analysts, 14 rate Strong Buy and four Buy; target prices range from ₹290–₹350. Portfolio positioning: value and income funds with energy exposure are likely accumulators on weakness, citing premium gas realisations and discovery cadence. Key risks: crude price volatility and execution slippage on large projects. Catalysts: progress on the 21-project pipeline, ramp-up at PY‑3/CBM assets, and clarity on gas pricing frameworks.