Company Update : Oil India Ltd by Motilal Oswal Financial Services Ltd
Higher-than-expected opex leads to a miss
* OINL’s revenue came in line with our estimate at INR54.6b.
* Oil & gas sales came in 4%/2% below our estimate at 0.83mmt/ 0.66bcm.
* Oil production was down 3% YoY at 848mmt. Gas production was flat YoY at 804bcm.
* Oil realization was USD68.2/bbl (our estimate of USD67.8/bbl).
* Adj. EBITDA was 16% below our estimate at INR18.4b (-16% YoY).
* During the quarter, OINL exited from one overseas block in Gabon and booked impairment expenses of INR1.9b and a penalty towards the unfinished work program of INR444m.
* The crude oil forward pumping tariff was revised with effect from FY19 for M/s NRL. The total amount arising from this revision up to 30 Sep’25 is ~INR2.9b (including arrears of about INR2.6b up to 31 Mar’25), and this has been recognized in 2QFY26.
* Exploration cost write-offs/provisions/impairments for 2QFY26 stood at INR9.8b (INR4.6b in 1QFY26).
* Reported PAT was 38% below our estimate at INR10.4b.
* Numaligarh refinery’s 2Q performance:
* PAT stood at INR7.2b (vs. PAT of INR1.8b during 2QFY25), as GRM stood at USD10.6/bbl.
* Crude throughput stood at 752.9tmt (up 10% YoY), and distillate yield was at 86.2% (vs. 84.1% in 2QFY25).
* The Board declared an interim dividend of INR3.5/share (FV: INR10/sh).
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