Nomura has maintained its buy rating on Oil and Natural Gas Corporation (ONGC) while lowering its target price to ₹270 per share after Q2FY26 earnings came in below estimates due to higher operating costs. The brokerage said it expects a 4% volume CAGR over FY25–28, supported by a mix of new production streams and ongoing field upgrades.
According to Nomura, management guided oil production of 19.8 million tonnes in FY26 and 21 million tonnes in FY27, with gas output projected at 20 and 21.5 billion cubic metres, respectively. The company plans annual capex of ₹300–350 billion and aims to cut operating costs by ₹50 billion through efficiency initiatives.
Nomura noted ONGC’s long-term plans include expanding its renewables capacity to 10GW by 2030 and achieving a 60% production boost at the Mumbai High field over 10 years under its BP TSP partnership. Additional gas from Daman and DSF-II fields is expected to add around 9 mmscmd from FY26–27. Management also indicated that the Mozambique LNG project may soon exit force majeure status.
Disclaimer: The views and recommendations above are those of Nomura. Business Upturn does not endorse them. Please consult a financial advisor before making investment decisions.
