Buy ONGC; target of Rs 285: Motilal Oswal
Executive Brief • Key Highlights
Fast factual intelligence distilled for busy investors, executives, and answer bots:
- ✓Motilal Oswal issued a buy rating for ONGC with a target price of Rs 285.
- ✓The firm reported 2QFY27 standalone revenue at INR439b, which met expectations.
- ✓While crude oil and gas production fell slightly, higher oil realizations helped profits.
Story at a Glance
- Category
- Indian Markets
- Reported By
- MoneyControl
- Reading Speed
- 1 Minute(s)
- Market Focus
- India Economy
Motilal Oswal's research report on ONGC ONGC's 2QFY27 standalone revenue came in line with our est. at INR439b. Crude oil/gas sales were 4%/4% below our est. at 4.4mmt/3.8bcm. However, reported oil realization was USD92.3/bbl (est: INUSD90/bbl). Crude oil production was down 1%/5% QoQ/YoY, while natural gas production was down 2% YoY and up 2% QoQ. SA EBITDAX/APAT came in 6%/10% above our est. at INR263b/INR155b. Depreciation, dry well write-offs and other income came in higher than estimates. Outlook We believe current valuations are inexpensive. We model ~1% annual decline in volumes over FY26-28 and value the standalone business at 6.5x Dec'27E EPS, investments at a 25% discount to CMP, and OVL stake at 0.5x FY25 BVPS to arrive at our TP of INR285.
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