Prabhudas Lilladher's research report on Oil India
We increase our FY23E/24E/25E estimates by 13.1/8.6/14.8% to factor in higher oil realization of US$84/75/bbl ($73/70/bbl earlier) and NRL GRMs to USD36.8/26.4/bbl ($28.8/24.4/bbl earlier). OINL reported Q2 results with consolidated EBIDTA/PAT of Rs27bn (-45%Q/Q) and Rs21.1bn (-34%Q/Q), led by weak NRL profitability and windfall tax impact. Standalone EBIDTA/PAT was at Rs18.5bn (-30%Q/Q PLe Rs17.5bn) and Rs17.2bn (+11% Q/Q; PLe Rs9.8bn). PAT outperformance was due to higher other income and lower tax. We believe OINL’s earnings will ride on healthy crude oil and gas realization, along with expansion of Numaligarh refinery (NRL) by 6MTPA (3MTPA capacity).
Outlook
Maintain ‘BUY’ with TP of Rs300 (largely unchanged), based on 3.0x/EV/E (3.5x earlier) FY24E and add value of investment in IOCL.
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