Oil India’s Q4 net profit falls 8% to Rs 848 crore

Oil India’s Q4 net profit falls 8% to Rs 848 crore

Even as Oil India witnessed an 8% drop in fiscal fourth quarter to March 21 net profit at Rs 848 crore, it’s share price has hit a fresh 52-week high at Rs 154.8 per share given the investor frenzied buying.
Given the rally in global gas prices, the domestic formula-based gas prices should witness a 120% rise over the next nine months.

Further, the FY23 crude assumption is 20% below the spot rate, which means the stock is only pricing-in $55/bbl Brent crude; using spot crude implies 75% upside. This is the only mid-cap stock that offers neat positive leverage to rising crude prices.
India’s second-largest state oil explorer — Oil India on Monday reported an eight per cent decline in the net profit to Rs 847.56 crore in the March-ended quarter of the financial year 2020-2021, on the back of lower crude oil production. It had reported Rs 925.6 crore profit in the same period a year ago.

It received $ 59.80 for every barrel of crude oil in the quarter, up from $ 5.18 a year back. But oil production fell by 5.28% to 0.72 million tonnes in January-March 2021.
During its earnings announcement, the company’s board also recommended a final dividend of Rs 1.50 per share for 2020-21. It had earlier paid an interim dividend of Rs 3.50 per share in February.

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