Indian Oil shares may rise up to 49% after strong Q4 results; analysts raise earnings estimates
Published on 02/05/2025 08:30 AM
Indian Oil shares may rise up to 49% after strong Q4 results; analysts raise earnings estimatesMorgan Stanley has a price target of ₹205 on Indian Oil Corporation, which implies a 49% upside from Wednesday's closing levels. This is also the highest price target on the street for the state-run oil refiner.By Hormaz Fatakia May 2, 2025, 8:30:12 AM IST (Published)2 Min ReadIndian Oil Corporation shares are likely to gain further momentum from current levels, analysts tracking the stock said after the state-run oil refiner's March quarter results.
It was a strong performance from the refining business that contributed to Indian Oil's earnings beat.
Brokerage firm Jefferies wrote in its note that Indian Oil may see inventory losses in the first quarter of the new financial year, with crude oil prices having declined $10 per barrel in April.
Even as the refining probability has weakened, the marketing margin has expanded sharply, Jefferies wrote in its note.
Post its March quarter results, Jefferies has raised Indian Oil's Earnings Before Interest, Tax, Depreciation and Amortisation (EBITDA) estimates by 15% and 17% respectively to factor in inflating marketing margins under a benign crude price assumption.
Morgan Stanley called Indian Oil a tactical play and said that its share price will rise in absolute terms over the next 30 days.
"With compensation of cooking gas related losses, we do see fuel prices remaining steady, even if oil prices were to decline," Morgan Stanley said.
Indian Oil Corporation is trading below book value at 0.9 times 12-months forward price-to-book value, which is 25% below its long-term average. "Better operating performance will help Indian Oil reduce the ongoing discount to HPCL and BPCL.
Morgan Stanley has a price target of ₹205 on Indian Oil Corporation, which implies a 49% upside from Wednesday's closing levels. This is also the highest price target on the street for the state-run oil refiner.
Out of the 34 analysts that have coverage on Indian Oil, 22 of them have a "buy" rating, five say "hold", while seven of them have a "sell" rating on the stock.
Shares of Indian Oil ended 1.1% higher on Wednesday at ₹137.25.Continue ReadingCheck out our in-depth Market Coverage, Business News & get real-time Stock Market Updates on CNBC-TV18. Also, Watch our channels CNBC-TV18, CNBC Awaaz and CNBC Bajar Live on-the-go!TagsIndian Oil Corp (IOC)Indian Oil Corporation (IOC)Indian Oil Share Priceshare market today