A day after taking charge of the Petroleum Ministry for the consecutive term in the Modi 3.0 regime, Hardeep Singh Puri on Tuesday said the Oil and Natural Gas Corporation (ONGC) will kick off gas production from its flagship deep-water project in the Krishna-Godavari (KG) basin block KG-DWN-98/2.
The minister said that oil and gas public sector undertaking (PSU) has done well. ONGC has floated a tender to get an international tech partner.
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“Both Minister Of State and I will try to bring gas under GST,” Puri said. He added that the oil production will increase to 45,000 barrels per day very soon.
The minister further said that he is not in favour of divestment of government stake in state-run oil companies. “Why would we divest ourselves of highly successful Maharatnas like BPCL,” he said.
ONGC’s shares have corrected 12 per cent from the peak of Rs 292.95 that it hit on May 3, 2024.
In a recent note, Jefferies said that the recent decline in ONGC’s stock price appears overdone.
It considers this an appealing buying opportunity for investors in a market that have been highly volatile over the past couple of weeks.
Jefferies also highlighted that a ramp-up in KG basin production in the third quarter of the current financial year and accretion to profitability are the key triggers.
It reiterated its ‘Buy’ recommendation on the stock with a price target of Rs 390 per share. The global brokerage believes that policy continuity on pricing reforms post elections should keep ONGC’s profitability elevated compared to its past averages.
