DUBAI  - ADNOC Distribution, the fuel distribution arm of Abu Dhabi National Oil Company (ADNOC), posted a 6.6 percent rise in first-quarter net profit on Wednesday.

Profit was 578 million dirhams ($157.37 million) in the three months to March 31, compared with 542 million dirhams a year earlier.

Analysts at Dubai-based Arqaam Capital had expected a profit of 543 million dirhams, while Egypt's EFG-Hermes had forecast that the company would post a profit of 558 million dirhams.

ADNOC Distribution said net cash generated from operating activities decreased in the quarter as a result of working capital movements due to fluctuating oil prices.

It said it expected low single-digit growth in fuel volumes beginning in the second half of this year, as a result of an ongoing expansion of its network in Dubai.

HSBC on April 8 raised its recommendation to "buy" from "hold", and target price to 3.2 dirhams from 2.6 dirhams.

In 2017, ADNOC listed 10 percent of ADNOC Distribution, the largest operator of petrol stations and convenience stores in the United Arab Emirates, on the Abu Dhabi Securities Exchange.

ADNOC is seeking a secondary listing for its distribution unit overseas, three sources told Reuters in April.

Reuters reported last June that ADNOC was considering selling another 10 percent stake in ADNOC Distribution.

One of the sources said ADNOC was considering listing ADNOC Distribution on New York's Nasdaq exchange, while a second source added that a London listing had also been discussed.

Another source said Abu Dhabi was also one of the options being discussed. ($1 = 3.6728 UAE dirham)

(Reporting by Hadeel Al Sayegh; Editing by Subhranshu Sahu) ((Hadeel.AlSayegh@thomsonreuters.com; +971566883310;))