State-run Oil and Natural Gas Corporation (ONGC) on Wednesday reported a 23 per cent rise in consolidated net profit for the December quarter, aided by improved margins and lower finance costs, even as crude price realisations declined year-on-year.
The company posted a consolidated net profit of ₹11,946 crore in Q3 FY26, compared with ₹9,747 crore in the year-ago period, according to its regulatory filing.
WHAT DRIVES ONGC’S Q3 FY26 PERFORMANCE
Profit Growth Despite Flat Revenue
Consolidated gross revenue in Q3 FY26 stood at ₹1,67,423 crore versus ₹1,67,213 crore in Q3 FY25, a marginal rise of 0.13%.
However, consolidated net profit jumped 23% to ₹11,946 crore from ₹9,747 crore.
Net profit attributable to owners rose 16.7% to ₹10,016 crore from ₹8,585 crore.
Revenue was flat, but profit surged. This indicates margin expansion and cost efficiency, not topline growth drove earnings.
For 9M FY26, revenue declined 1.43% to ₹4,88,442 crore, yet net profit rose nearly 23% to ₹36,115 crore. Clear margin-led performance.
Standalone Revenue Impacted by Lower Crude Prices
Standalone Q3 revenue declined 6.4% to ₹31,546 crore from ₹33,717 crore.
This was mainly due to lower crude realisations:
* Nominated crude realisation fell 15% to $61.63/bbl from $72.57/bbl.
* JV crude realisation fell 13% to $63.00/bbl from $72.59/bbl.
Despite this sharp drop in prices, standalone net profit still rose 1.6% to ₹8,372 crore from ₹8,240 crore.
Even with weaker crude prices, upstream profitability remained resilient.
Production Stability is Key Positive
Crude production (Standalone):
* Q3 FY26: 4.592 MMT
* Q3 FY25: 4.653 MMT
For 9M FY26, crude production rose 0.35% to 13.907 MMT from 13.858 MMT.
Natural gas production remained stable:
* Q3 FY26: 4.988 BCM
* Q3 FY25: 4.978 BCM
9M gas production remained steady at 14.751 BCM.
Volume stability offsets part of the price decline impact.
New Well Gas Becoming a Strategic Earnings Driver
Revenue from New Well Gas during 9M FY26 stood at ₹5,028 crore.
This generated ₹944 crore additional revenue over APM pricing and now contributes more than 18% of total gas sales revenue.
Nomination gas price rose slightly to $6.59/mmbtu from $6.50/mmbtu.
Gas portfolio is increasingly cushioning crude price volatility.
Dividend Reflects Strong Cash Position
Board declared 2nd interim dividend of ₹6.25 per share (125%).
Earlier ₹6 per share was declared.
Total interim dividend for FY26 so far: ₹12.25 per share (245%).
Total cumulative interim payout: ₹15,411 crore.
Q3 payout alone: ₹7,863 crore.
Strong dividend signals healthy cash flows and balance sheet comfort.
Exploration & Project Momentum Supports Future Growth
* 735.82 LKM of 2D seismic acquired
* 4,484.59 SKM of 3D seismic acquired
* 2 discoveries monetised (Anor in Gujarat, Gojalia-14 in Tripura)
* Ultra-deepwater Andaman well spudded
* KG-98/2 and Daman Upside projects nearing production
Ensures reserve replacement and future production visibility.
Bottom Line
* Profit growth is margin-led, not revenue-led
* Crude prices declined sharply but profitability held
* Gas portfolio gaining importance
* Production stabilising
* Strong dividend payout reinforces financial strength
ONGC’s Q3 reflects operational resilience and diversified earnings support despite weaker crude pricing.
