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Informist, Wednesday, Nov. 12, 2025

By J. Navya Sruthi

MUMBAI – State-owned Oil India Ltd. is expected to post a weak bottom-line growth for the September quarter due to a sharp on-year decline in oil realisations. The company's revenue is likely to remain flat on year, as higher gas realisation and a weaker rupee are likely to offset the impact of lower oil sales, analysts said.

The upstream producer's net profit for the September quarter is projected to fall about 17% on year to INR 15.28 billion, according to the average of estimates from nine brokerages. The lowest estimate for the company's September quarter net profit is INR 11.50 billion by ICICI Securities Ltd. and the highest is INR 19.06 billion by Kotak Securities Ltd.

Kotak Securities expects gross crude price realisation at $69 per barrel, down 14% on year, and net oil price realisation at $47 per barrel, down 5% on year. The dip in net crude realisation is due to a significant correction in global crude prices, analysts said, noting the weakness in rupee during the quarter has limited the downside.

The Maharatna company's overall crude oil sales volumes during the reporting quarter are seen at 828,000 tonnes, down 1% on year, Kotak Securities said. Nomura expects oil sales volumes at 837,000 tonnes, flat on year.

An increase in crude oil supply by the Organization of the Petroleum Exporting Countries, coupled with muted demand and persistent tariff woes, has weighed on crude prices so far in 2025. Brent crude prices fell over 8% on year to $66.08 per barrel in the September quarter.

Oil India Ltd. is an upstream Maharatna company, focused on the exploration, development, and production of crude oil and natural gas. Oil India International Pte. Ltd. in Singapore, Oil India Sweden AB, and Oil India International B.V in the Netherlands are its wholly-owned subsidiary companies. The Maharatna company also holds a 69.63% stake in Numaligarh Refinery Ltd. 

Analysts expect Oil India Ltd.'s revenue to remain largely steady at INR 52.88 billion on year as lower oil sales are likely to be offset by higher gas realisations and a weaker rupee. Brokerage JM Financial expects the company's gas realisations may see a slight improvement, with the domestic administered price mechanism gas price averaging higher at $6.75 per million British thermal units in the September quarter from $6.6 per million British thermal units in the year-ago quarter.

ICICI Securities expects the company's gas realisations to improve from a higher mix of new well gas, priced at 20% premium to an administered price mechanism gas price of $6.75 per million British thermal units for the September quarter. The volume of natural gas allocated to city gas distribution companies by the government under administered pricing mechanism is on the decline. To offset this fall in administered price mechanism gas, the government has been allocating natural gas from the newly developed wells, which is at 20% premium to administered price mechanism gas.

However, analysts expect both the revenue and profit to grow on a sequential basis due to a low base. On a sequential basis, the company's net profit is likely to grow over 87% from INR 8.13 billion and revenue is seen rising over 5% from INR 50.12 billion.

At 1511 IST, shares of Oil India traded 1.4% higher at INR 442.05 on the National Stock Exchange. Shares have risen over 3% since the company reported its June quarter results. Of the 11 brokerage reports on the company available with Informist, nine have a 'buy' view on the stock, with a target price of INR 528. One brokerage has a 'hold' view and another has a 'sell' view, with a target price of INR 315.

Oil India will announce its September quarter results Friday. Analysts will watch out for management commentary on the outlook for crude prices, trends in gas pricing, and any update on exploration activity.

The following are the Jul-Sept earnings estimates for Oil India Ltd. from nine brokerages in descending order of the estimate of net profit in INR million:

End

US$1 = INR 88.63

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Subhojit Sarkar

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