The Large cap oil exploration stock hit its 52-week high of Rs 203.4 after the company board of directors plans to invest Rs 1,00,000 crore in the petrochemical business.
Oil and Natural Gas Corporation Ltd (ONGC) reported that net revenue decreased by 12 percent year on year from Rs 1,68,656 crores in Q2FY23 to Rs 1,46,873 crores in Q2FY24. In addition, net profit increased 142.3 percent year on year, from Rs 6,830 crores in Q2FY23 to Rs 16,553 crores in Q2FY24.
During an investor call, ONGC Board of Directors announced to investment of Rs 1,00,000 crore to increase companies petro chemical capacity business to 8.5-9 million tonnes by 2030. In addition to this, ONGC is to infuse funds of Rs 18,355 crore in ONGC Petro-Additions Limited (OPaL) business to increase its stake in OPaL business from 49.35% to 96% in the states of Karnataka and Gurajat.
These projects aim to help ONGC achieve net zero carbon emissions by 2038. By 2030, ONGC intends to increase its renewable portfolio to 10 GW.
OPaL is to be an ONGC subsidiary temporarily but plans to remain a joint venture and seek a strategic partner within 3 years. Equity infusion to aid turnaround, and target profitability in FY24-25.
The company’s promoters hold a 58.9 percent stake in the company, with 8.3 percent owned by foreign institutional investors, 2.8 percent owned by the general public, and 30 percent owned by domestic institutional investors.
ONGC is a large-cap company with a Market capitalization of Rs 2,50,976 Crores the share rose 20 percent in the last six months and 41% in a year.
Crude oil is a primary source of energy extracted by companies such as ONGC from under the seabed and underground reservoirs. The oil is then processed in refineries to produce petrol, diesel, and jet fuel. As the world moves towards a transition away from fossil fuels, companies across the globe are exploring new ways to use crude oil.
Petrochemicals are chemicals derived from crude oil and used to make detergents, plastics, and synthetic fibers like nylon and polyester.
The Oil and Natural Gas Corporation Limited is an Indian central public sector undertaking owned by the Government of India’s Ministry of Petroleum and Natural Gas.
Written by Sriram KV
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