Don't expect oil prices to rise above $100/bbl anytime soon; BPCL, IOC may see rerating: Prakash Diwan

In a chat with ET Now, Prakash Diwan, Director - Altamount Capital Management, shares his view on how the fourth quarter earnings panned out for markets.

ET Now: You are positive on IT stocks. But outside of IT, what else is looking interesting to you?

Prakash Diwan: If you are okay with the regulatory overhang, then oil and gas seems to be another area which…because we are finally getting some clarity.
I spoke to a few people in UK and when I asked them about oil, they said that they are not perturbed at all.

Of course it does not impact them as much as it does to us, but their assumption is that now that the US is proven to be one of the largest producer outside of the OPEC for oil and this is despite the fact that Shale gas has been curtailed.

You could very clearly see them, calibrating oil prices to the lower side.

It is not likely to move to the $100 a barrel level at any point in time, at least in the next one-and-a-half next years. It means all the three OMCs, which have just kind of seen the turnaround of sorts, will actually start showing profits.

do not know how they will manage that because they have never got the opportunity to handle money; they were always in deficit. But, if they were to do that, there will be a rerating of sorts for them especially for BPCL and IOCL. Even from a valuation perspective we have never paid too much for these companies.