Buy ONGC shares, price target Rs 195: ICICI Securities

ONGC Share Price Target 2023: Shares of state-run Oil and Natural Gas Corporation (ONGC) gained more than 2 per cent during Friday's trading session. It was among the top gainers on Nifty. The stock opened at Rs 145.45 apiece on NSE and gained more than 2 per cent to hit the day's high of Rs 148.75.

Meanwhile, domestic brokerage firm ICICI Securities in a research report on ONGC has maintained Buy rating. The firm estimates an EPS CAGR of 19 per cent over FY22-24E, driven by assumptions of US$75/bbl crude realisation, US $7.8/mmbtu gas realisation and a CAGR of 3.9 per cent in overall group production (including OVL).

The company's standalone production of oil and gas (including JV share) declined by 6.7 million tonnes in the last 4 years, the report mentioned. 

While the start of production from the KG basin asset and new assets is expected to redress this trend over FY23-FY27, the brokerage report remained conservative in estimates, factoring-in 3 per cent CAGR in oil and 9 per cent CAGR in gas output (standalone) over FY22-FY24E.

The report also highlighted the key risks including a sharp reversal in oil & gas price trends, further delays in start of production from KG basin and regulatory setbacks.

ONGC Share Price Target 

ICICI Securities recommended buying ONGC shares for a price target of Rs 195.

ONGC is a central public sector undertaking under the ownership of Ministry of Petroleum and Natural Gas, Government of India. It is headquartered in New Delhi. It is the largest government-owned-oil and gas explorer and producer in the country, and produces around 70% of India's crude oil (equivalent to around 57% of the country's total demand) and around 84% of its natural gas. In November 2010, the Government of India conferred the Maharatna status to ONGC.

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