Prabhudas Lilladher has given Buy recommendation for Oil and Natural Gas Corporation with a target price of Rs. 160 in its research report issued on Aug 13, 2022
Prabhudas Lilladher’s research report on Oil and Natural Gas Corporation
We maintain our FY23/24E earnings. ONGC’s Q1 standalone EBIDTA was in line at Rs259.3bn (+40%Q/Q; PLe Rs255.1bn), while PAT of Rs152.1bn (+71%Q/Q PLe Rs147.5bn) was due to high crude oil and gas realization. Q1 consolidated EBIDTA/PAT stood at Rs200.8bn (-26%Q/Q) and Rs92.5bn (- 35%Q/Q) due to losses at HPCL. Recent government decision to impose windfall taxes will mean ONGC’s crude oil realization will be ~USD60-70/bbl, thereby not benefiting from soaring commodity prices.
Outlook
We maintain ‘BUY’ rating with PT of Rs160 based on 3.5x EV/E FY23E (unchanged).