India's Oil and Natural Gas Corp (ONGC) beat first-quarter profit estimates on Monday, bolstered by strong domestic fuel demand and higher price realisation.
India's fuel consumption largely rose from year-ago periods in the quarter, data from the oil ministry showed, helped by strong industrial activity. The country is the world's third-biggest oil importer and consumer.
Strength in the power sector, solid economic growth and higher jet fuel consumption helped demand, Prashant Vasisht, vice president and co-head, corporate ratings at ICRA, said earlier this year.
ONGC reported a standalone profit of 89.38 billion rupees ($1.06 billion) for the three months to June 30, beating analysts' average estimate of 85.85 billion rupees, per LSEG data.
The company's standalone earnings exclude profit from joint ventures, refining and marketing and profit from outside India operations.
ONGC's crude oil price realisation, or the price at which it sells the product, grew 8.8% to $83.05 per barrel, compared with $76.36 per barrel a year ago.
Its revenue from operations rose 4% to 352.66 billion rupees.
However, the company's profit still fell 15%, which analysts attributed to the government's windfall tax on petroleum crude - a tax levied on specific industries when they gain a sudden boost in their profits.
ONGC's expenses swelled 19% to 253.71 billion rupees, led by an 18% rise in depreciation, depletion, amortisation and impairment costs.
Shares of ONGC closed 6% lower on Monday amid a broader market sell-off.
Peer Oil India is expected to report quarterly results later this week.
