Buy Oil And Natural Gas Corporation, target price Rs 206: HDFC Securities

HDFC Securities has buy call on Oil And Natural Gas Corporation with a target price of Rs 206. The current market price of Oil And Natural Gas Corporation is Rs 165.2. Time period given by analyst is six months when Oil And Natural Gas Corporation Ltd. price can reach defined target.

Oil And Natural Gas Corporation Ltd., incorporated in the year 1993, is a Large Cap company (having a market cap of Rs 216129.20 Crore) operating in Gas & Petroleum sector.

Oil And Natural Gas Corporation Ltd. key Products/Revenue Segments include Oil Crude, Gas Natural, Naphtha, Ethane, Propane, C2/C3 (Ethane/Propane), Butane, HSD, Subsidy, Superior Kerosene Oil, Electricity, LSHS, Other Operating Revenue, Aviation Turbine Fuel (ATF), Mineral Turpentine Oil (MTO), Processing Charges, Others for the year ending 31-Mar-2021.


Financials
For the quarter ended 31-12-2021, the company reported a Consolidated Total Income of Rs 147814.67 Crore, up 19.74 % from last quarter Total Income of Rs 123444.95 Crore and up 44.33 % from last year same quarter Total Income of Rs 102416.51 Crore. Company reported net profit after tax of Rs 10936.33 Crore in latest quarter.

Investment Rationale
ONGC enjoys a dominant market position in the domestic crude oil and natural gas production business with large proven reserves, globally competitive cost structure, and stable performance of its subsidiary ONGC Videsh Ltd. (OVL). Any value unlocking from subsidiaries and other investments & lower holding company discount on investments can be positive for the stock. The company also has excellent financial flexibility arising from its moderate gearing, large liquid investments, its significant sovereign ownership and strategic importance.


Promoter/FII Holdings
Promoters held 60.41 per cent stake in the company as of 31-Dec-2021, while FIIs owned 8.87 per cent, DIIs 17.17 per cent.