Oil and Natural Gas Corp's stock slipped 3% to hit seven-month low on December 15 and was the top Nifty loser. Axis Capital initiated coverage on the shares with a "sell" rating due to the state-run firm's declining oil production and muted oil prices outlook.
The domestic brokerage gave a price target of Rs 205 for the stock, which indicates a potential downside of up to 12% from the current market price.
This is ONGC's first "sell" rating since May and Axis Capital's price target is lowest after HSBC had set price target of Rs 200.
Axis Capital flags production declines for ONGC, citing ageing fields and said crude price outlook remains muted with Brent crude assumed at $66-$65 per barrel over FY26-27, weighing on ONGC's margins.
At 12:35 pm on December 15, ONGC shares on NSE were trading 2% lower at Rs 233 apiece, extending their fall to fourth straight session, and were the top Nifty loser. Over 8.5 million shares of the company have changed hands on the NSE so far Monday, already nearly twice more than the shares traded on Friday.
So far in 2025, the stock fell 3%.
Oil prices climbed on Monday as supply disruptions linked to escalating U.S.-Venezuela tensions outweighed oversupply worries and the impact of a potential Russia-Ukraine peace deal.
Brent crude futures were up 33 cents, or 0.54%, at $61.45 a barrel, as of 0429 GMT, and U.S. West Texas Intermediate crude was at $57.75 a barrel, up 31 cents, or 0.54%.
Both contracts slid more than 4% in the prior week, weighed down by expectations of a surplus in 2026.
In November, ONGC posted a 22% rise in net profit in the second quarter of this financial year. It has posted a consolidated profit of Rs 9,848 crore. This is in comparison to profit of Rs 8,024.23 crore in the preceding quarter. ONGC's revenue increased by 3.2% sequentially for the second quarter, reaching Rs 33,031 crore.
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