Motilal Oswal's research report on Oil India
At its analyst meet, Oil India (OINL) management reiterated its target of increasing production from 6.5mmtoe in FY24 to 9mmtoe by FY26. Oil production is expected to ramp up from 3.4mmt in FY24 to 3.8mmt and more than 4mmt in FY25/FY26, while gas production is likely to be 5bcm by FY26. In contrast, we build in oil and gas production of 3.7mmt and 4.2bcm in FY26, respectively. FY25 capex guidance was INR69b, up from INR59b in FY24. Numaligarh refinery is slated to start in Dec’25, with the Paradeep- Numaligarh pipeline expansion set to be completed by Sep’25. Construction of the INR72b PP project (360 KTA capacity) at NRL will begin in 2QFY25.
Outlook
We value the stock at 8.5x FY26E standalone adj. EPS and add investments to arrive at our TP of INR775. Maintain BUY.
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