Sharekhan has given Buy recommendation for Oil India with a target price of Rs. 290 in its research report issued on Feb 14, 2022

Sharekhan’s research report on Oil India

Q3FY22 standalone operating profit of Rs. 1,267 crore, up 39% q-o-q missed our estimate due to higher cost of support services. Adjusted PAT of Rs. 1,267 crore, up 147% q-o-q was above our estimate led by higher dividend income. Oil business EBIT up by 24% q-o-q to Rs. 1,199 crore while gas EBIT loss declined by 68.5% q-o-q to Rs. 108 crore primarily due to rise in oil & gas realisation. Oil realisations rose by 10% q-o-q to $79/bbl while volumes were in-line. Potential steep upward revision in domestic gas price (OIL’s expectation of +90-98%/+22% for H1FY23/H2FY23 to $5.5-5.75/$7 per mmBtu) and surge in crude oil prices bodes well for earnings of upstream PSUs. We thus increase our FY22E/FY23E/FY24E EPS by 19%/25%/10% for Oil India.

Outlook

We maintain our Buy rating on Oil India with a revised SoTP-based PT of Rs. 290 as risk-reward seems favourable in the rising oil & gas price environment. The stock trades at 4x its FY2023E EPS (including earnings contribution from NRL).

More Info on Oil India

At 09:41 hrs Oil India was quoting at Rs 230.90, down Rs 1.05, or 0.45 percent.

It has touched an intraday high of Rs 233.50 and an intraday low of Rs 230.90.

It was trading with volumes of 6,437 shares, compared to its thirty day average of shares, a decrease of percent.

In the previous trading session, the share closed up 0.28 percent or Rs 0.65 at Rs 231.95.

The share touched its 52-week high Rs 267.70 and 52-week low Rs 112.00 on 01 October, 2021 and 12 April, 2021, respectively.

Currently, it is trading 13.75 percent below its 52-week high and 106.16 percent above its 52-week low.

Market capitalisation stands at Rs 25,038.92 crore.

 

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