| Raha: Feather in the cap
New Delhi, June 23: Oil and Natural Gas Corporation (ONGC) today became the first Indian corporate entity to turn in a net profit of over Rs 10,000 crore in 2002-03, a feat that won it a place on the Financial Times’ Global 500 list of companies.
At Rs 10,529.33 crore, the profit was 70 per cent higher than Rs 6,197.87 crore in 2001-02. Turnover increased 53.4 per cent, from Rs 22,514.2 crore to Rs 34,536.4 crore. A pay-out of 300 per cent, which works out to Rs 4,277.80 crore, has been declared. Of this, an interim dividend of 170 per cent, worth Rs 2,424.09 crore, has already been paid.
While London’s FT has ranked ONGC 326th in its Global 500 listing of firms, the Forbes magazine puts it at number 133 on its list of 400 top global companies, assessed by market capitalisation and profit. The market cap of ONGC, whose net worth rose 20 per cent to Rs 35,608 crore, is over Rs 70,000 crore.
Talking to reporters after announcing the results today, company chairman and managing director Subir Raha said Rs 16,566 crore — Rs 10,309 crore in India and Rs 6,257 crore in oil fields abroad — will be invested in 2003-04. Revenues are estimated to rise to Rs 37,088 crore in the current financial year, along with a modest rise in profit.
The gains were fuelled by a decision to lift the cap on prices that refiners pay ONGC for its crude. “Increase in international oil prices by a dollar per barrel results in an incremental revenue of Rs 918 crore. We expect a 10 per cent increase in domestic gas price over the current price of Rs 2206 per thousand cubic metres in the current year. That will yield an incremental revenue of Rs 415 crore,” Raha said.
A committee of secretaries has recommended an immediate increase in the maximum price for ONGC’s natural gas to Rs 3250 per thousand cubic metres.
Under the current policy, gas produced by the company can fetch, at most, Rs 2,850 per thousand cubic metres. In joint venture fields like Ravva, UK’s Cairn Energy, which operates the field, is paid international price, while ONGC sells the same gas to customers at the price set by the government. The difference in the two prices is borne by the company.
Industrial Development Bank of India has sold 7.56 crore shares, representing about 1 per cent of the paid-up capital, of MRPL to ONGC for Rs 81.5 crore. The deal is one of the several struck last week in which ONGC acquired Rs 35.60 crore of MRPL shares from banks and financial institutions.