ONGC Q4 FY25 Deep Dive: Profit Decline, Renewable Push & Strategic Growth
Updated June 2025
📊 Performance at a Glance
| Metric | Q4 FY25 | Q4 FY24 | YoY Change |
|---|---|---|---|
| Standalone Net Profit | ₹6,448 cr | ₹9,869 cr | ↓35% :contentReference[oaicite:1]{index=1} |
| Consolidated Net Profit | ₹8,856 cr | ₹11,096 cr | ↓20% :contentReference[oaicite:2]{index=2} |
| Revenue (Ops) | ₹34,982 cr | ₹34,636 cr | Flat :contentReference[oaicite:3]{index=3} |
[Chart: Q4 Profit YoY Comparison]
🧭 Key Performance Drivers
- Lower oil & gas realizations: Avg crude at → $76.90/bbl (down ~4.8%) and gas at $6.50/mmbtu :contentReference[oaicite:4]{index=4}
- Exploration write‑offs surged: ₹5,046 cr vs ₹1,516 cr YoY, sharply reducing earnings :contentReference[oaicite:5]{index=5}
- Strong CapEx & drilling: 578 wells drilled—the highest in 35 years; ₹62,000 cr spent overall :contentReference[oaicite:6]{index=6}
♻️ Renewables Push
- ₹3,500 cr green energy investment for FY26 aiming for 10 GW capacity by 2030 :contentReference[oaicite:7]{index=7}
- Major M&A move: ONGPL acquiring Ayana Renewables (~4.1 GW solar/wind), one of India's largest deals :contentReference[oaicite:8]{index=8}
[Chart: Renewable Capacity Growth (Current vs Target)]
🔍 SWOT Analysis
- Strengths: Market leader (~70% domestic crude share), strong dividend tradition, negligible debt (D/E ~0.03) :contentReference[oaicite:9]{index=9}
- Weaknesses: Profit vulnerability to price swings; high exploration costs
- Opportunities: Green push (10 GW by 2030); gas price guarantees for new wells :contentReference[oaicite:10]{index=10}
- Threats: Regulatory pressure on fossil fuels, commodity volatility, macro uncertainty
📊 Peer Comparison Snapshot
| Company | Market Cap (₹cr) | Net Margin | Dividend Yield |
|---|---|---|---|
| ONGC | 3,22,558 | ~18% | ₹1.25/share (~1.5%) |
| Oil India | 56,000 | ~22%* | ~₹2/share* |
| Reliance Energy | — | ~15%* | ~₹0.5/share* |
*Industry estimates :contentReference[oaicite:11]{index=11}
🔜 What Comes Next?
- Recovery hinges on crude prices stabilizing above $80/bbl and normalization of gas realizations
- Exploration cost control will be key; write-offs easing could restore margin strength
- Green capacity ramp-up provides a longer-term buffer and ESG advantage
- Dividend continuity supports yield investors even amid cyclicity
✅ Final Take
ONGC posted a sharp profit decline in Q4 FY25 due to write-offs and commodity pressure. However, its financial robustness, commitment to dividends, and aggressive green-energy pivot mark a strategic shift. For investors eyeing both value and transition, ONGC represents a blend of legacy resiliency and future readiness.
📚 References
- “ONGC Q4 profit drops 35% … ₹6,448 cr” – ET :contentReference[oaicite:12]{index=12}
- Consolidated Q4 results – Financial Express :contentReference[oaicite:13]{index=13}
- Exploration write-offs & well data – Energy Watch :contentReference[oaicite:14]{index=14}
- Green energy strategy – ET Green :contentReference[oaicite:15]{index=15}
- Ayana deal info – Reddit r/IndianStockMarket :contentReference[oaicite:16]{index=16}
0 Comments