Hold ONGC, BPCL may hit Rs 1030: Jal Irani

Jal Irani, oil & gas analyst at Edelweiss Financial Services told CNBC-TV18, "In Bharat Petroleum Corporation (BPCL) our target price is Rs 1030. We perhaps have the highest on the street. The gas stocks haven’t performed very well and especially for GAIL India we have recently upgraded from a underperformer to a hold recommendation. I think the worst is over for these stocks because these stocks are hugely leveraged to oil prices including GAIL because its input cost essentially in his largest business which is petrochemicals is fixed. So, that input cost doesn’t change dramatically. While its product price which is petrochemicals is linked to international prices and as a result we think the worst is over for them but the upside also at the moment would be limited."

"Oil and Natural Gas Corporation (ONGC) may not have to bear any subsidy burden or very little if at all. That makes them very sensitive to oil prices and similarly we think that oil is not in the longer term going to go down dramatically. So, fundamentally we see very modest growth for both of them in terms of volumes but from an operational leverage perspective, the worst is over for these companies," he said.

"We have a hold recommendation for ONGC, at the moment we don’t think that it is going to move within a 10 percent band in either direction. It is not going to move significantly," he added.