Oil India a good bet, says Dipan Mehta

Oil India is a good trading bet, says Dipan Mehta, Member- BSE/ NSE.
 
Mehta told CNBC-TV18, “Most of the PSU oil companies including Oil India are good trading bets. The highlight is the fact that the government has finally got practical about how it is suppose to go about the disinvestment program where it is offering adequate discount. The most heartening fact is that investors in the PSU stocks have actually made money in the earlier ones and that is bringing more and more investors to apply for future issuances and that is a very healthy and positive sign which means the government is being quite pragmatic about its disinvestment program.”
 
He further added, “From an investment point of view the entire PSU oil sector still remains well under government control and the deregulation or whatever you say is just on paper. The stocks have come off extremely cheap valuations but going forward for these stocks to rally and come off their own and take leadership position, you will need more than just minor tinkering with diesel prices, something pragmatic or something major has to be done over here whereby investors are convinced that now these companies will be run on professional basis without government interference and I don’t see that happening in the near future. So, while the rally is there investors can make trading bets over there, some who have invested earlier in the years could look at lightening up but for long-term investors I don’t think oil companies can be part of the core holding.”