Angel expects decline in Q4 net profit of Oil & Gas
Angel Broking has come with its quarterly earning estimates on oil & gas sector for March 2012. The research firm expects, RIL to report top-line growth of 16.5% yoy on the back of higher prices of petrochemical products.
April 11, 2012 / 14:57 IST
Angel Broking has come with its quarterly earning estimates on oil & gas sector for March 2012. The research firm expects, RIL to report top-line growth of 16.5% yoy on the back of higher prices of petrochemical products.
During 4QFY2012, average Brent crude oil price increased by 8.7% qoq as tension over Iran's nuclear issues supported prices, offsetting the news of increased oil production from Saudi Arabia. WTI crude oil price rose by 9.5%, broadly reflecting the rise in Brent crude oil price. Henry Hub natural gas price declined by 27.1% qoq on the back of forecasts suggesting cooler weather, which in turn would cut demand for air conditioning. Prices of petrochemical products rose modestly during the quarter.During January and February 2012, Indian crude oil basket stood at US$110/bbl and US$118/bbl, respectively. During March 2012, oil marketing companies (OMCs) continued to lose `486cr per day on account of selling diesel, kerosene and domestic LPG at subsidized rates. During March 2012, OMCs continued to lose `13.1/liter, `28.7/liter and `440/cylinder on diesel, kerosene and domestic LPG, respectively.Oil & Gas stocks rise during 4QFY2012During 4QFY2012, BSE Oil and Gas (O&G) Index recorded an increase of 6.0%. After a steep decline during 3QFY2012, O&G stocks gained during January and February 2012, in-line with the increase in broader markets. However, the stocks declined during March 2012. Cairn India stock gained during January and February due to higher global crude oil prices. RIL's stock gained during January and February 2012 but declined in March 2012 due to the decrease in gas production from KG-D6 basin. GAIL stock declined by 1.9% during 4QFY2012, reflecting the decrease in KG-D6 gas production. RIL, Cairn and ONGC stocks gained 8.3%, 6.3% and 4.6%, respectively, during the quarter. 4QFY2012 - Result expectationsFor 4QFY2012, we expect a decline in the net profit of Oil & Gas companies under our coverage.ONGC is expected to post a decline of 5.6% yoy in its top line. The company
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