ONGC has reported a 19.5 per cent drop in net profit to ₹ 3,935 crore for the fourth quarter of 2014-15, as the company suffered from lower price realisation from its crude oil sold from joint venture fields and a write-off on dry wells drilled. In the same quarter last year, the company had reported a net profit of ₹ 4,889 crore.

The company’s total revenue grew 1.5 per cent to ₹ 21,647.49 crore, against ₹ 21,313.09 crore. Despite the drop in profit, the company's board recommended a dividend of ₹ 0.50 per equity share, subject to shareholders' approval at the annual general meeting.

ONGC’s net realisation was $55.63 per barrel against $44.87 per barrel in the same quarter last year. However, its operating cost also rose ₹ 1,278 crore, which hit its net profit. The impact of the write-off for exploration expense on drilling wells that did not lead to discoveries was ₹291 crore. ONGC’s profit was also affected by lower revenue from value-added products that are linked to international crude oil prices. Revenue from such products was down 35 per cent to ₹ 1,886 crore.

The company’s Chairman and Managing Director DK Sarraf said ONGC was exempt from paying any fuel subsidy in the fourth quarter of 2014-15 and will also not be required to pay any in the first quarter of current fiscal, adding that things “look better” in the first quarter of fiscal 2015-16.

ONGC Videsh IPO The Government is keen to list ONGC Videsh Ltd, the overseas investment arm of ONGC, but the company is not keen to do so.

A senior OVL official said, “We have received a letter from the government on listing of ONGC Videsh. However, it would be better if we wait for the company to be bigger and stronger.”

The official added that it is the Department of Disinvestment that is pushing for a sale.

On being asked about the matter, ONGC Videsh’s Managing Director NK Verma said the company has presented its view to the government, but he did not disclose the details.

He said there are both pros and cons to listing. “Right now, the dynamic between ONGC and OVL is different. OVL is like a baby for ONGC. By listing and having new shareholders on board, things would be very different,” said Verma.

ONGC Chairman, however, avoided a direct reply to a question whether the government has written to the company seeking listing of OVL. “The company is not considering any such proposal”, he said.

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