4 months ago
113
ARTICLE AD BOX
Oil and vigor steadfast shares began the week successful greenish amid ongoing geopolitical concerns successful surrounding South American lipid producing nation, Venezuela. Reliance Industries Limited (RIL) soared 1% to its 52-week precocious of Rs 1,611.20 portion different lipid stocks besides added up to 2% connected Monday.
The emergence came adjacent arsenic planetary crude prices remained mostly level owed to proviso surplus concerns.Hindustan Petroleum led the gains, rising 1.85% to an intraday precocious of Rs 508.45. ONGC precocious 1.16% to Rs 246.80, Indian Oil Corporation added 1.03% to Rs 168.79, and Oil India roseate 0.47% to Rs 432.45. This follows the melodramatic removal of Venezuela's President Nicolas Maduro and his wife, successful a large-scale US subject cognition implicit the weekend.
The duo was transported to America wherever they volition beryllium facing galore charges, including narco-terrorism and cause trafficking. US President Donald Trump has vowed to “run the country” until determination is simply a “proper” modulation of power, introducing caller uncertainty for Venezuela’s lipid manufacture and its planetary partners. ONGC is expected to stay nether the spotlight owed to its nonstop vulnerability to Venezuelan assets done its overseas arm, ONGC Videsh, which holds equity stakes successful 2 projects successful the country.
Market involvement has intensified amid speculation that a US-led restructuring of Venezuela’s lipid assemblage could perchance unlock long-pending currency flows. Global brokerage location Jefferies, arsenic cited by ET, said that ONGC whitethorn beryllium adjacent to recovering astir US$500 cardinal successful unpaid dividends from its Venezuelan upstream investment. “ONGC has not been paid its stock of dividends from accumulation astatine San Cristobal, totaling much than US$500mn,” the brokerage said, adding that “with the US stepping in, ONGC whitethorn basal to retrieve these unpaid amounts,” subjected to a imaginable easing of sanctions and changes successful power and selling of Venezuelan crude. The unpaid dividends are linked to ONGC Videsh’s concern successful the San Cristobal field. While the plus has been producing, the repatriation of profits has been blocked by US sanctions connected Caracas, forcing ONGC to proceed carrying the receivable connected its books and leaving investors uncertain astir when, oregon if, the funds would beryllium realised. Jefferies said that immoderate betterment from Venezuela would travel successful summation to ONGC’s existing currency generation.
The institution reported a consolidated nett net of Rs 571 cardinal successful FY24, with escaped currency travel to steadfast of Rs 473.6 cardinal and a double-digit free-cash-flow yield. The banal is trading beneath publication value, with a FY24 price-to-book aggregate of 0.9 times and an net output of 18.1%, according to ET. The brokerage besides flagged imaginable upside from ONGC’s 2nd Venezuelan asset. “It mightiness besides beryllium capable to make the Carabobo tract successful Venezuela's Orinoco belt; ONGC has an 11% equity involvement successful the field,” analysts wrote, adding that the stalled superior expenditure plans mightiness beryllium revived if operating conditions improve.
Jefferies valued ONGC’s consolidated operations astatine 8.2 times its December 2026 guardant earnings.
The brokerage has maintained a ‘Buy’ telephone connected the stock, mounting a people terms of Rs 310, which implies a imaginable upside of 28% from its past closing level of Rs 241.50.However, the brokerage warned, “lower Brent, little crude/gas terms realizations, and/or lower-than-expected accumulation from KG 98/2 are cardinal downside risks,” portion identifying the imaginable US$500 cardinal dividend betterment arsenic a medium-term catalyst, ET reported. Another institution nether the radar is Oil India. The firm, done its wholly owned subsidiary, Oil India Sweden AB, owns 50% of Indoil Netherlands BV, which holds a 7% equity involvement successful Petrocarabobo SA, the associated task down Project Carabobo-1. Reliance Industries is besides expected to stay successful spotlight, arsenic the institution has been buying Venezuelan crude. However, reports successful March past twelvemonth said that it whitethorn halt specified imports aft the US announced a 25% tariff connected countries purchasing lipid from Venezuela. Indian Oil Corporation whitethorn pull attraction arsenic well, arsenic its subsidiary, IOC Sweden AB, functions arsenic an concern institution for exploration and accumulation projects successful Venezuela, alongside a artillery exertion task successful Israel.Meanwhile, crude prices showed constricted movement. Brent crude futures edged up 0.2% to $60.87 arsenic markets weighed the US involution successful Venezuela against an OPEC+ determination connected Sunday to support lipid output unchanged.(Disclaimer: Recommendations and views connected the banal market, different plus classes oregon idiosyncratic concern absorption tips fixed by experts are their own. These opinions bash not correspond the views of The Times of India)
