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. Experts believe current valuations are inexpensive and suggest a positive outlook ahead.
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.
Reiterate BUY. For all recommendations report, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. ONGC - 0911026 - moti