Buy Oil and Natural Gas Corporation; target of Rs 145: Geojit

Geojit's research report on Oil and Natural Gas Corporation

Oil and Natural Gas Corporation Limited specializes in the exploration and production of crude oil and gas. The Company has joint ventures in oil fields in Vietnam, Norway, Egypt, Tunisia, Iran and Australia. ONGC’s Q4FY21 standalone revenue inched down by 1.2% YoY to Rs. 21,189cr mainly affected by lower realization and weak demand for Natural Gas segment. Reduction in material costs and other expenses aided growth in EBITDA (+64.1% YoY to Rs. 11,282cr). Resultantly, PAT also rose 144.6% YoY, further helped by lower D&A and interest costs.

Outlook

Therefore, we reiterate our BUY rating on the stock with a revised TP of Rs. 145 based on SOTP valuation.

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