Oil & Natural Gas Corporation (ONGC IN) – Q4FY26 Result Update – Moving towards a gas-led portfolio – ACCUMULATE
Published on 27 May 2026
Revenue improved 13.9% QoQ and 2.7% YoY to INR359.3bn (PLe: INR345.2bn; BBGe: INR362.1bn), primarily driven by higher crude oil realizations, partly offset by lower sales volumes. Total standalone sales volumes declined 4.0% QoQ and 3.5% YoY, while crude oil realization increased to USD78.3/bbl (+27.1% QoQ; +6.2% YoY). Adj. EBITDA (ex GST provision) stood at INR186.1bn, up 7.4% QoQ but down 2.1% YoY, impacted by higher employee and other expenses. Adj. PAT came in at INR73.0bn, down 17.2% QoQ while up 6.0% YoY. ONGC plans to drill ~500 wells, including ~400 developmental wells. Management indicated future production volumes will increasingly tilt toward gas, supported by a rising contribution from NWG volumes. Given the continued weakness in recent production trends, we maintain conservative production assumptions. We build in FY27 standalone production at 19.8mmt for oil and 20.1bcm for gas (previous: oil 20.0mmt; gas 20.6bcm). For FY28, we estimate oil production of 20.6mmt and gas production of 21.2bcm, reflecting modest improvement as key projects gradually ramp up and become operational. We maintain “Accumulate” rating with a revised target price of INR297 (earlier: INR309) based on 9x FY28E EPS for the standalone business, along with the addition of investment value.
