Jefferies has maintained its buy rating on Oil and Natural Gas Corporation (ONGC) but trimmed its target price to ₹310 per share, noting that consolidated EBITDA and PAT were broadly in line with its estimates for Q2FY26. The brokerage said ONGC continues to optimise operating costs to protect profitability in a softer crude environment, with management guiding for production growth starting Q4FY26.
Jefferies described ONGC as the cheapest major oil stock globally, trading at valuations that discount crude prices of around US$60 per barrel. The firm cut its FY27 and FY28 earnings estimates by 5% and 8%, respectively, to reflect near-term pricing and production challenges but said long-term fundamentals remain intact.
The brokerage expects that higher output from upcoming fields, combined with lower operating expenses, should drive gradual earnings improvement over the next two years. ONGC’s focus on cash flow preservation, coupled with its strategic partnerships and renewables diversification, underpins Jefferies’ positive stance.
Disclaimer: The views and recommendations above are those of Jefferies. Business Upturn does not endorse them. Please consult a financial advisor before making investment decisions.
