Slightly bullish on ONGC at this point: Ambareesh Baliga

In a chat with ET Now, Ambareesh Baliga, Market Expert, shares his views on ONGC.

ET Now: What is your view on ONGC stock?

Ambareesh Baliga: For ONGC, in fact, I would be slightly bullish at this point of time because the stock has not really performed.

At the same time, we should also remember that the subsidy regime is more or less out. Going ahead, subsidy sharing, which was there will actually come down quite sharply.


ET Now: If the market reaction to a possible divestment was not enough, we are learning that IOC likely to oppose the stake sale as well and it would not come as a surprise would not because the valuations are anyways not the best compared to some of the others and if indeed the divestment process is to go about, then in all probability we might see the stock being under further pressure as well?

Ambareesh Baliga: Absolutely, there is pressure on the stock and normally it is never really at the best valuation possible and at the same time since the best has already been played out for most of the OMCs.

I really do not see the valuations really improving further from here for even the rest of OMCs because if you have oil prices still falling further, you will have the excise duty being raised, nearly four times they have raised, so I do not think the margins would be as huge as what was envisaged or discounted by the markets earlier and because of which even going ahead I do not see the OMCs really performing.