Vedanta Oil and Gas Ltd reported a 7% year-on-year revenue growth to Rs 2,486 crore for Q2 FY27, with EBITDA surging 34% to Rs 1,393 crore. Operational highlights include a gross production of 72.2 kboepd, supported by new discoveries in Rajasthan. While growth remains a key theme, investors are keeping a close watch on the ongoing legal dispute regarding the Cambay block, which is currently sub-judice after the PSC extension was rejected.
Vedanta Oil and Gas Reports Strong Q2 FY27 Growth
Revenue: Rs 2,486 crore, up 7% YoY.
EBITDA: Rs 1,393 crore, up 34% YoY.
Reader Takeaway: Strong operational margins and new Rajasthan discoveries boost growth, offset by ongoing legal uncertainty at Cambay.
What just happened
Vedanta Oil and Gas reported a robust performance for the second quarter of FY27. Revenue climbed to Rs 2,486 crore, marking a 7% year-on-year increase. The company's profitability improved significantly, with EBITDA reaching Rs 1,393 crore, a 34% jump from the previous year. This resulted in a healthy EBITDA margin of 56%. Profit after tax (PAT) from continuing operations stood at Rs 746 crore for the quarter.
Operational Highlights
The company recorded an average daily gross operated production of 72.2 kboepd. The Rajasthan block remains the company's primary asset, contributing 59.9 kboepd. Management noted that specific production optimization initiatives have been successful in stabilizing output in mature assets and reversing decline trends at the Ravva field.
Exploration and Growth
Expansion efforts continue with three new discoveries identified in the Rajasthan block during the first half of the year. These findings include both shallow-oil and deep-gas reservoirs. Additionally, the company secured two offshore blocks in the Krishna Godavari Basin via the DSF IV bid round, though regulatory transfer processes are ongoing.
FY27 Guidance
For the full fiscal year 2027, the company targets production volumes between 73 and 77 kboepd. Guidance for operating costs is set at $19.5-20.0 per boe, with planned capital expenditure ranging from $320 to $340 million.
Risks to watch
Investors should closely monitor the legal developments regarding the Cambay block. The Production Sharing Contract (PSC) extension was rejected, and while Vedanta Oil and Gas has challenged this in the Delhi High Court, the site operations are currently under the control of ONGC. The matter is sub-judice, creating a notable regulatory overhang for that specific asset.