On the BSE in Monday’s intra-day trade, in an otherwise weak market, as Brent crude rose after Saudi Arabia raised its price for its crude sales in July, shares of Oil India rose 5% to Rs 261.45. In comparison, the S&P BSE Sensex fell 0.45% to 55,519 points at 10:09 am.

Oil India stock was trading near its 52-week high of Rs 267.70, which was touched on October 1, 2021. Last week, it surpassed the market by 17%, compared to the 0.61% fall in the S&P BSE Sensex.

According to a Reuters report, oil prices rose more than $2 in early trade on Monday after Saudi Arabia sharply raised prices for its crude sales in July, indicating how strong the supply is despite OPEC+ agreeing to accelerate production growth over the next two months.

Meanwhile, Oil India reported strong earnings for the March 2022 quarter (Q4FY22) as turnover and after-tax profit (PAT) increased by 74% and 92%, respectively. The company reported Q4FY22, its all-time highest quarterly net profit of Rs 1,630 crore, as it received about $100 per barrel price for oil – produced and sold. Net profit for the quarter nearly doubled from Rs 847.56 crore in the same period last year.

Analysts at HDFC Securities believe that Oil India is a favourable buy after rising crude prices and rising domestic gas prices. Rs 300 has been set based on an increase in crude oil prices and an improvement in domestic gas prices. Oil prices for FY22 have risen to $76.7/ bbl, vs $43/bbl. The brokerage firm Q4FY22 said in the results update report.

Likewise, ONGC shares rose 2% to Rs 154.30 on the BSE. HDFC Securities also has a “buy” recommendation on ONGC with a price target of Rs 220, based on higher crude oil prices and higher domestic natural gas prices.

“Management has guided positive CAPEX of Rs 310 billion for exploration activities over the next three years. Oil production guidance for FY23/24 is 21.6/21.7mmt, while gas production guidance is 24.4/26.1bcm. Management does not expect any increased taxes on the company as it has aggressive CAPEX plans for exploration and development activities. The production of KG 98/2 is still on track and is expected to peak at 12mmscmd by FY25,” the brokerage said in a statement in the Fourth-quarter results update.