ONGC's Q2 financials show negative performance and concerning trends for investors

Oil & Natural Gas Corporation (ONGC) has recently declared its financial results for the quarter ending September 2024. The company, which operates in the oil exploration and refineries industry, has been given a 'Sell' call by MarketsMOJO.

According to the financials, ONGC has seen a negative performance in the second quarter of the fiscal year 2024-2025. The company's score has fallen from -9 to -15 in the last three months.

However, there are some positive aspects to ONGC's financials. The company has shown a strong operating cash flow, with the highest annual amount of Rs 99,262.69 crore and a consistent growth over the past three years. This indicates that the company has been able to generate higher cash revenues from its business operations.

On the other hand, there are some concerning factors as well. The profit before tax (PBT) less other income has fallen by -36.7% in the last quarter, compared to the average PBT of the previous four quarters. This trend is expected to continue in the near term. Additionally, the interest cost has increased by 40.90% in the last half-yearly period, indicating a rise in borrowings. The company's ability to manage interest payments has also deteriorated, with the operating profit to interest ratio being the lowest in the last five quarters.

The profit after tax (PAT) has also seen a decline of -10.2% in the last quarter, compared to the average PAT of the previous four quarters. The operating profit and PBT have also been at their lowest in the last five quarters. On a positive note, the non-operating income has been the highest in the last five quarters, but it may not be sustainable in the long run.

In conclusion, ONGC's financial performance for the quarter ending September 2024 has been negative, with some concerning trends in key areas. Investors are advised to carefully consider these factors before making any investment decisions.