OGDC is expected to post 2QFY24f NPAT of PKR45.1bn (EPS: PKR10.48) with a QoQ reduction of 8% (up 8% YoY). This shall bring 1HFY24 NPAT to PKR94.1bn (EPS: PKR21.88), flat YoY. The sequential decline in earnings is attributed to lower gas production and the absence of one-off exchange gains due to a stable exchange rate during 2Q.

Revenue is estimated at PKR111.3bn with a QoQ decline of 7%, mainly due to lower volumes, particularly gas. Gas production is expected at 659mmcfd with a QoQ and YoY decline of 14% and 15%, respectively.

A major decline in production was witnessed in the Uch gas field by 29% QoQ, attributable to lower offtake by the Uch Power Plant due to annual turnaround. Qadirpur field gas production is contracted by 20% QoQ. However, the addition of Bettani during the quarter partly supported production levels in 2Q. On the other hand, oil production increased by 4% QoQ to 34.2kbpd due to the addition of bettani, which should support the earnings.

We estimate OGDC to declare an interim DPS of PKR2.5 in 2QFY24.

Courtesy – IMS Research