ONGC Q2 Earnings Shocker: Mixed Results, Stock Jumps! Brokerages Divided - What's Next?

Oil and Natural Gas Corporation (ONGC) announced mixed financial results for the September quarter of FY26. While the company benefited from higher sales volumes and improved realisations, its net profit was affected by a significant increase in operating expenses, including foreign exchange losses. Standalone net revenue saw a 3% sequential increase to ₹33,000 crore, supported by a 3% rise in crude oil sales volume to 4.8 million tonnes and a 1% rise in gas sales to 3.9 billion cubic meters. Net crude realisation improved by 2% to $67.3 per barrel. However, EBITDA declined by 3% quarter-on-quarter to ₹16,600 crore due to elevated operating costs. Net income rose 23% sequentially to ₹9,840 crore, boosted by higher other income. Despite the mixed operational performance, ONGC's share price surged up to 2.42% to an intraday high of ₹255.50. Brokerage reactions were largely cautious. Nomura noted the results missed estimates due to elevated operating expenses but maintained a 'Neutral' rating with a reduced target price of ₹270. Motilal Oswal reiterated a 'Neutral' rating with a target price of ₹250, highlighting challenges in production ramp-up and a preference for other sectors. Nuvama retained its 'Reduce' rating and a target price of ₹233, expressing a bearish view on oil prices and trimming production guidance slightly due to delays in the KG-98/2 field. Impact: This news has a direct impact on the Indian stock market, particularly the energy sector, as ONGC is a major constituent. Investor sentiment, stock performance, and analyst outlooks on ONGC and its peers can be influenced, potentially leading to short-term price fluctuations. Rating: 7/10

Difficult Terms Explained: * FY26: Financial Year 2025-2026. * EBITDA: Earnings Before Interest, Taxes, Depreciation, and Amortisation. It's a measure of a company's operating performance. * Realisation: The average price at which a company sells its products or services. In this case, the price ONGC gets per barrel of crude oil. * Q-o-Q / Sequential: Quarter-on-Quarter, meaning a comparison between the current quarter's results and the previous quarter's results. * Y-o-Y: Year-on-Year, meaning a comparison between the current quarter's results and the same quarter in the previous year. * bcm: Billion Cubic Meters, a unit of volume for natural gas. * mt: Million Tonnes, a unit of volume for crude oil. * FX losses: Foreign Exchange losses, incurred when the value of a foreign currency in which a company holds assets or liabilities decreases relative to the company's reporting currency. * EbitdaX: Earnings Before Interest, Taxes, Depreciation, Amortisation, and Exploration Expense. Similar to EBITDA but also excludes exploration expenses. * GRM: Gross Refining Margin, the difference between the price of crude oil and the value of the refined petroleum products it yields. * Brent: A major global benchmark price for crude oil. * P/B: Price-to-Book ratio, a valuation metric that compares a company's stock price to its book value per share. * EPS: Earnings Per Share, a company's net profit divided by the number of outstanding shares.