Nomura said crude oil prices have softened due to rising OPEC+ supplies, while cautioning that INR depreciation remains a risk for oil marketing companies (OMCs) and city gas distributors (CGDs).
The brokerage noted that a sharp fall in Singapore gross refining margins (GRMs) is unlikely to significantly hurt Indian refiners, with OMC margins still healthy at over ₹6 per litre. Nomura maintained buy ratings on HPCL, BPCL and IOCL, adding that BPCL is best placed among the three.
In the CGD space, the brokerage said lower LNG prices will act as a positive driver for companies including Petronet LNG, Gujarat Gas, GAIL, MGL and IGL, supporting volume growth and profitability.
Disclaimer: The views and investment recommendations expressed are those of Nomura. These do not represent the views of this publication and should not be considered as investment advice. Investors are advised to consult their financial advisors before making any investment decisions.