Oil & Natural Gas Corporation Ltd Fundamental Analysis

Oil & Natural Gas Corporation Ltd fundamental analysis highlights key financial metrics, including a market capitalization of ₹4,09,677 crore, a PE ratio of 9.00, a debt-to-equity ratio of 0.45, and a return on equity (ROE) of 16%..3 These figures indicate the bank’s financial health and its ability to manage debt while delivering returns.

Oil & Natural Gas Corporation Ltd Overview

Oil & Natural Gas Corporation Ltd (ONGC) is India’s leading oil and gas exploration company, playing a pivotal role in India’s energy sector. Established in 1956, ONGC is known for significant domestic and international hydrocarbon discoveries.

The company has a market capitalization of ₹4,09,677 crore and is listed on both the Bombay Stock Exchange (BSE) and National Stock Exchange (NSE). Currently, the stock is trading 13.5% below its 52-week high and 171% above its 52-week low.

Oil & Natural Gas Corporation Financial Results

Oil & Natural Gas Corporation (ONGC) in FY24 saw sales of ₹6,43,037 crore, with an operating profit of ₹1,02,835 crore and a net profit of ₹57,101 crore. Comparatively in FY22 sales were ₹4,91,270 crore, with net profits of  ₹49,294 crore.

1. Revenue Trend: ONGC’s sales increased from ₹4,91,270 crores in FY22 to ₹6,32,326 crores in FY23 and further to ₹6,43,037 crores in FY24. This consistent growth underscores the company’s strong market performance.
2. Equity and Liabilities: ONGC’s equity capital stood at ₹6,290 Crores in FY24, with reserves increasing to ₹2,99,686 Crores. Total liabilities increased to ₹4,46,021 Crores from ₹3,67,707 Crores in FY23, indicating a growing financial base.
3. Profitability: The operating profit margin (OPM) for ONGC was 16% in both FY24 and FY22 and 13% in FY23. Profit before tax (PBT) was ₹52,627 crores in FY22, ₹43,017 crores in FY23, and ₹74,464 crores in FY24.
4. Earnings Per Share (EPS): ONGC’s EPS was ₹36.19 in FY22, ₹28.17 in FY23, and rose to ₹39.13 in FY24. This reflects the company’s improved profitability and shareholder value over the three financial years.
5. Return on Net Worth (RoNW): The Return on Net Worth (RoNW) slightly increased to 14.4% in FY24 from 14% in FY23, suggesting a modest improvement in returns on shareholders’ equity.
6. Financial Position: ONGC’s EBITDA was ₹88,120 crores in FY22, ₹87,347 crores in FY23, and increased to ₹1,15,057 crores in FY24. Dividend payout ratios were 29.01% in FY22, 39.94% in FY23, and 31.31% in FY24.

Oil & Natural Gas Corporation Financial Analysis

All values in ₹ Crores.

Oil & Natural Gas Corporation Company Metrics

ONGC’s market capitalization is ₹4,09,677 crores with a current stock price of ₹326. The company has a P/E ratio of 9.00, a dividend yield of 3.73%, and a net profit of ₹49,420 crores.

1. Market Cap: ONGC’s market capitalization is ₹4,09,677 crores, reflecting its substantial market presence. This valuation indicates a strong investor confidence and a major position in the industry.
2. Book Value: The book value per share for ONGC is ₹268. This metric suggests a solid asset base, providing a measure of the company’s net asset worth relative to its share price.
3. Face Value: ONGC’s face value is ₹5.00 per share. This is the nominal value assigned to each share, representing the minimum value below which the share cannot be issued.
4. Turnover: ONGC’s asset turnover ratio is 0.97, illustrating the company’s efficiency in generating revenue from its assets.
5. PE Ratio: The Price-to-Earnings (P/E) ratio for ONGC is 9.00, indicating that the stock is valued at 9 times its earnings.
6. Debt: ONGC’s total debt stands at ₹1,53,181 crores, with a debt-to-equity ratio of 0.45. This reflects a moderate level of debt compared to equity, indicating manageable financial leverage.
7. ROE: The Return on Equity (ROE) for ONGC is 16.3%, demonstrating the effective use of shareholders’ equity to generate profit.
8. EBITDA Margin: ONGC’s EBITDA margin is 14.5%, showing the proportion of revenue that remains after operating expenses are deducted.
9. Dividend Yield: ONGC offers a dividend yield of 3.73%, providing shareholders with a return on their investment through dividends. 

Oil & Natural Gas Corporation Stock Performance

The table shows ONGC’s return on investment: 22% over 5 years, 43% over 3 years, and 87% over 1 year, indicating strong recent performance and increasing investor returns.

Examples:

1. Investing ₹1,00,000 for 5 years yields ₹1,22,000 return.
2. Investing ₹1,00,000 for 3 years yields ₹1,43,000 return.
3. Investing ₹1,00,000 for 1 year yields ₹1,87,000 return.

Oil & Natural Gas Corporation Peer Comparison

The competitor analysis reveals ONGC’s position in the sector compared to its peers. Oil India, with a market cap of ₹1,09,796.03 Crores., leads in 1-year returns at 246.08%, while ONGC’s market cap stands at ₹4,09,677.81 Crores. and the PEG ratio is 0.91. Other competitors include Hindustan Oil Exploration, Deep Industries, Selan Exploration Technologies, and Asian Energy, each showing varied market performance and return metrics.

Oil & Natural Gas Corporation Shareholding Pattern

The shareholding pattern of ONGC shows consistent promoter ownership at 58.89% from December 2023 through June 2024. FII share decreased from 9.2% to 8.57%, while DII share remained stable at around 18.75%, and retail & others increased from 13.19% to 13.8%.

All values in %

Oil & Natural Gas Corporation History

ONGC was established in 1956 to explore hydrocarbons in India. It quickly made significant discoveries, including its first oil find in the Cambay Basin, Gujarat, in 1959. In 1970, ONGC discovered the Bombay High oil field, one of India’s most significant offshore fields. This discovery positioned India as a key player in global oil production.

By the 1980s, ONGC expanded into offshore exploration, further strengthening India’s energy sector. The 1990s saw its transformation into a public limited company, opening doors for greater growth. In 2001, ONGC launched its international arm, ONGC Videsh Ltd., marking its global expansion. Strategic acquisitions, like the 2018 purchase of HPCL, diversified its operations.

ONGC’s continuous growth earned it global recognition, securing a spot on the Fortune Global 500 list. It remains crucial to India’s energy security and global energy market presence.

How To Invest In Oil & Natural Gas Corporation Ltd Share?

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• Open a Demat Account: Start by opening a Demat and trading account with a reliable brokerage firm like Alice Blue.
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Oil & Natural Gas Corporation Limited Fundamental Analysis – FAQs

Disclaimer: The above article is written for educational purposes, and the companies’ data mentioned in the article may change with respect to time The securities quoted are exemplary and are not recommendatory.