Buy ONGC for Rs. 290: Motilal Oswal Sees Attractive Risk-Reward Profile
Motilal Oswal Financial Services Ltd recommends buying Oil and Natural Gas Corporation (ONGC) for a target price of Rs. 290.
The analysts at Motilal Oswal believe that ONGC's risk-reward profile remains attractive due to its high dividend yield, modest production growth, and greater operational freedom.
One key reason for their recommendation is ONGC's 1-year-forward dividend yield of 6.9%, which is a three-year high. This level has only been breached twice in the last decade, during crises such as the Covid-19 pandemic and windfall tax.
The analysts also point out that global agencies have turned more constructive on crude prices, with the US EIA raising its CY26/27 Brent forecast by 6% to $87/bbl, while the IEA's CY26 deficit estimate has widened to 2.7mb/d.