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Increase in gas price will benefit upstream players; upgraded ONGC, OIL and RIL: IIFL

It is a steep hike so the prices for domestic gas has been increased to 6.1 dollars per mmBtu, which compares with 2.9 dollars per mmBtu. It is a big hike because of the way global gas prices have moved. Harshvardhan Dole, Vice President Institutional Equities of IIFL said, “Subsequent to the APM price increase, we have upgraded in Oil and Natural Gas Corporation (ONGC), Oil India (OIL) and Reliance Industries FY23 EPS by 20 percent, 15 percent and 8 percent respectively. If the gas prices actually sustain similar EPS upgrade will be seen in FY24 as well. So certainly, the gas price will benefit the upstream players and rightfully so.” He added, “ONGC continues to be one of the cheapest stocks in India, no doubt on that. From a portfolio allocation perspective, one should be mindful whether this is a trade or a long-term allocation? In my opinion, given the fact that these companies have reported, actually no volume growth, and their volume growth will be very anemic the at best will be tactical based rather than long-term portfolio allocations to me.” For full interview, watch the accompanying video.

Disclaimer: Network18, the parent company of, is controlled by Independent Media Trust, of which Reliance Industries is the sole beneficiary.

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