Despite the near-term volatility, HPCL's valuations remain reasonable, the brokerage noted. The stock trades at 1.4x one-year forward price-to-book, slightly above its long-term average of 1.2x.
According to Nuvama, the outlook for OMCs is clouded by high capital expenditure commitments and rising under-recoveries, which are set to keep return ratios suppressed.
Corporate earnings logged a 3rd straight quarter of double-digit growth, underpinned by strong performances from OMCs, Metals, Telecom, Technology, Cement, NBFCs - Lending, and Capital Goods.
Nomura said that the INR's depreciation remains a headwind for OMCs and CGDs, as their input costs are dollar-linked while revenues are in rupees.
IOCL share price: Indian Oil Corp shares were volatile as June-quarter profit nearly doubles but misses estimates
Trump Tariff Impact: The US has imposed a 25 per cent penalty via executive order, which takes the total tariff burden to 50 per cent on select Indian goods.
The Nifty Oil & Gas index is seen testing the 200-DMA support on charts; break below the same could weigh on the sentiment at Reliance, ONGC and Oil marketing companies counters.
Oil & Gas stocks declined in trade after US President Donald Trump threatened to raise tariffs in Indian imports over the purchase of a "massive" amount of Russian crude oil
The government is set to compensate OMCs for ₹30,000 crore LPG losses through excise duty collections, easing subsidy burden without straining the expenditure budget
Stocks to Watch today: OMCs, IT stocks, Raymond Realty, JSW Energy, HAL, NTPC, LT Foods, YES Bank, Avantel and NLC India are among the stocks to watch today, June 23, 2025
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BPCL, HPCL, IOC, Asian Paints and other downstream oil companies' stock fell, while ONGC, Oil India rose after Brent crude oil spiked 13 per cent
OMC stocks: HPCL, BPCL, IOC shares were under pressure in Thursday's trade as oil prices rose on fresh tensions scaling up in Middle East
Share price of India Glycols hit a new high of ₹1,639.80 on the BSE in Tuesday's intra-day trade and rallied 17% in past two trading days on healthy outlook.
Downstream businesses like the oil marketing companies (OMCs) and gas players gain
Petroleum Ministry officials say long-term solutions are needed as global LPG prices rise and subsidy burdens on OMCs become increasingly unsustainable
OMCs hold 45 days inventory priced at around $75 per barrel crude
Technically, HPCL, BPCL stock seem to be favourably placed on the charts with key support at ₹ 324 and ₹ 255, respectively. IOC stock chart however flags a caution sign.
When oil prices drop, upstream companies face reduced revenue, which can lead to cost-cutting measures, reduced profits, and in some cases, financial losses
Crude oil prices fell below $70 per barrel over US President Donald Trump's new tariffs, raising concerns over a global trade war that could weigh on oil demand