Oil India’s share jumped over 1% to Rs 279.35 today owing to a strong operating performance in Q1FY24.
Oil India’s stock surged over 1% today to Rs 279.35 on account of a stable and a strong operating performance with its EBITDA in-line at Rs 23 billion in Q1FY24. However, the company’s revenue was below estimates for some brokerages, at Rs 46.4 billion, down 22% on-year and 18% on-quarter due to decline in oil and gas realization. Oil India’s PAT also declined by 9.8% on-quarter to Rs 16.1 billion owing to higher depreciation, interest and lower other income. Oil India’s share price has jumped over 9% in the last one month and nearly 25% in the last six months. Analysts at Emkay, Motilal Oswal and Prabhudas Lilladher have recommended a ‘Buy’ rating on Oil India’s stock.
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Should you buy, sell or hold Oil India’s stock?
Emkay
Buy | Target Price: Rs 330
“Mgmt. reiterated OIL’s production target of 4mmtpa oil/5bcmpa gas by FY25-26 via accelerated drilling, workover, fracking & EOR (FY24 target of 4-5% growth). We trim our consol. EPS for FY24E by 7% to factor in NRL’s net loss in Q1, with S/A earnings intact. We remain positive on the upstream sector, led by steady earnings visibility & attractive valuation. We retain BUY with an unchanged Mar-24 TP of Rs330/sh.”
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Motilal Oswal
Buy | Target Price: Rs 345
“The stock currently trades at a P/E multiple of 6.4x FY24E EPS. We value the stock at 6x FY25E standalone adj. EPS and add investments to arrive at our TP of INR345. We reiterate our BUY rating on the stock.”
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Prabhudas Lilladher
Buy | Target Price: Rs 341
“The company aims to achieve its targeted production of 4 MMT of oil and 5 BCM of gas by FY25 end and on a conservative basis we have built in a 3% CAGR both in oil and gas production over FY23-25. The stock is trading at 6.3x FY25 EPS and 5x FY25 EV/EBITDA. We maintain our ‘Buy’ rating on the stock, valuing it on SoTP based fair value of 6x FY25 EPS and add investments to arrive at our TP of 341.”
