By Aditya Raghunath
Investing.com — Oil giant Indian Oil Corporation Ltd (NS:) is on the radar of multiple brokerages with 10 analysts giving it an average price target of Rs 124.56. That’s an upside of over 41% from its current price of Rs 88.15.
Nirmal Bang Institutional has maintained its buy rating on the firm with a target price of Rs 146. It says that refining and petrochemical margins of IOC are ‘at trough levels and could revive over the next 1-2 years due to likely closure of capacities’. It also says that the price fall since March has priced in worries about policy and volatility.
Sharekhan has given a target price of Rs 115 for IOC. It says that ‘Potential monetization of non-core pipeline assets would help in value unlocking and privatization of BPCL is expected to re-rate the refining and marketing business’. IOC is also trading a significant valuation discount to BPCL and will catch up in 2021.
IOC has reported sales worth Rs 81,704.43 crore for the September 2020 quarter, up 34.98 % from the June 2020 quarter of Rs 60,528.68 crore. Sharekhan says that IOC’s earnings will likely sustain in the third quarter of FY21 as it’ll be the first quarter of normalized volumes since the COVID-19 pandemic.