Shares of oil explorer Cairn India rose 3.8% to Rs 353.90, tracking gains in crude oil prices and after UBS upgraded the stock to "buy" from "neutral" and raised its target price to Rs 400 from Rs 375.
UBS said Cairn was a good proxy to play the rising crude prices and the weakening rupee, while saying it expected a "healthy" dividend from the unit of UK-based explorer Cairn Energy sometime in the next three months.
Cairn was also "likely" to announce "positive" updates in the next six months about reserves at the Rajasthan block, as well as possibly from its Sri Lanka reserves, the investment bank added.
Despite a recently proposed hike in oil production taxes from the Indian government, UBS upgraded Cairn's fiscal 2013-14 earnings-per-share by 3-4%.
Cairn shares dropped 9.5% in March, dragged down by profit worries after the announced cess hike , under-performing a 1.7% fall last month in the broader Nifty index.
According to CRISIL, the Indian arm of Standard & Poor which rates over 9,000 issuers in India, credit ratings have fallen the most in three ...