Oil & Natural Gas Corporation Ltd.
NSE: ONGCOil & Natural Gas Corporation Ltd.: A 30-second snapshot
ONGC trades at ₹264.75, up 17.6% over the past year but 13.9% below its 52-week high, sitting above the 200-DMA (₹252.70) while 7.6% below the 50-DMA. The trailing PE of 8.0 and dividend yield of 6.99% reflect a low-growth, high-yield PSU profile: 5-year revenue CAGR of 1.9% against a 47.8% earnings CAGR driven by margin normalisation from a low base, a profit margin of 6.25%, and a quality score of 53 out of 100 — ranking 3rd of 6 in the Energy sector peer set.
P/E
8.0
Forward P/E
6.1
ROE
+12.7%
Debt / Equity
42.55
Profit Margin
+6.3%
Div. Yield
+7.0%
5Y ROE > 15%
0/5
5Y FCF > 0
4/5
Quality
57/100
News
8 headlines · 5 positive · 1 negative
ONGC sees gas eclipsing oil as core earnings driver, targets 7-8% annual output growth - PSU Watch
PSU Watch
ONGC, Oil India shares: Royalty cuts may boost earnings; should you buy? - Target prices - Business Today
Business Today
ONGC appoints Satyan Kumar as Strategy Director till 2028 - scanx.trade
scanx.trade
Oil and Natural Gas Corporation Limited Recommends Final Dividend for the Financial Year 2025-26 - marketscreener.com
marketscreener.com
ONGC moves to rupee payments for Indian bidders in ship hiring tenders to save forex outgo - ET Infra
ET Infra
Recent context
- ·ONGC has articulated a strategy targeting 7-8% annual production growth with natural gas positioned as the primary future earnings driver, signalling a portfolio transition away from oil-weighted revenue.
- ·Potential royalty cuts for upstream PSUs were flagged by media in mid-May 2026 as a factor that could improve earnings; the outcome of any policy change remains unconfirmed.
- ·The company shifted ship-hiring tenders to rupee denomination to reduce forex outgo, a cost-management initiative that addresses a margin pressure point in the current environment.
Strengths
- +Dividend yield of 6.99% is among the highest in the Energy sector peer set; the company recommended a final dividend for FY2025-26, sustaining its capital-return track record.
- +Forward PE of 6.1 represents a 24% compression from the trailing PE of 8.0, indicating that consensus earnings estimates project meaningful near-term profit growth relative to current price.
- +Free cash flow was positive in 4 of the available tracked years, and the company has announced a strategic shift targeting 7-8% annual output growth with gas increasingly replacing oil as the core earnings driver.
- +At ₹264.75, the stock trades above the 200-DMA (₹252.70), maintaining the longer-term trend structure intact despite the 3-month decline of 4.2%.
Weaknesses
- −ROE of 12.7% has never crossed 15% in any tracked year (roeYearsAbove15 = 0) and the 5-year consistency score stands at 25/100, reflecting structurally sub-cost-of-equity returns.
- −D/E of 42.5 is anomalously elevated for a non-financial; combined with a 6.25% profit margin and near-flat revenue growth of 1.9% over five years, any adverse shift in crude prices or subsidy policy would have an outsized impact on debt-service capacity.
- −The stock has declined 4.2% over the past three months and is 7.6% below the 50-DMA with RSI at 32.9, indicating deteriorating short-to-medium-term price momentum.
- −Quality score of 53/100 ranks 3rd of 6 in the Energy peer set — below Coal India (77) and BPCL (55) — and the persistence consistency score of 25/100 signals that historical earnings quality has been inconsistent.
Open questions
- ?Does the 47.8% five-year earnings CAGR reflect a durable improvement in ONGC's cost structure and pricing realisation, or does it primarily reflect a cyclical recovery from a low-base period that may not persist?
- ?How does ONGC's ability to sustain a 6.99% dividend yield hold up if crude oil prices decline materially, given the 6.25% profit margin and D/E of 42.5?
- ?If the gas-focused growth strategy delivers 7-8% annual output growth, what proportion of incremental revenue would translate to net income given the thin margin profile and the potential for government pricing intervention in the gas segment?
- ?Given that ROE has not exceeded 15% in any tracked year, what structural change — operational, regulatory, or commodity-price driven — would be required for ONGC to consistently generate returns above its cost of equity?
Peer comparison: Energy
Ranks 3 of 6 on quality| Symbol | Name | P/E | ROE | Quality |
|---|---|---|---|---|
| ONGC | Oil & Natural Gas Corporation Ltd.You're viewing | 8.0 | +12.7% | 53 |
| Industry avg | across 5 peers | 11.0 | +19.1% | 46 |
| COALINDIA | Coal India Ltd. | 9.4 | +28.1% | 77 |
| BPCL | Bharat Petroleum Corporation Ltd. | 4.9 | +28.5% | 55 |
| IOC | Indian Oil Corporation Ltd. | 4.5 | +21.0% | 49 |
| RELIANCE | Reliance Industries Ltd. | 21.6 | +9.1% | 32 |
| GAIL | GAIL (India) Ltd. | 14.5 | +8.7% | 19 |
Technical state
Current price
₹264.75
SMA 50
₹285.06
SMA 200
₹252.70
RSI (14)
32.9 (neutral)
From 52w high
-13.9%
1Y return
+17.6%
3M return
-4.2%
50-DMA
Below
200-DMA
Above
Algorithmic support levels
Algorithmic resistance levels
Risk flags
- mediumD/E of 42.5 is anomalously high for a non-financial sector stock; as a PSU upstream operator exposed to government-administered pricing and potential subsidy obligations, a sustained crude-price decline or reinstatement of subsidy burden could materially strain debt-service capacity.
- mediumROE of 12.7% has never exceeded 15% in any tracked year (roeYearsAbove15 = 0) and the 5-year consistency score is 25/100, indicating structural difficulty sustaining returns above cost of equity despite the reported 47.8% 5-year earnings CAGR, which reflects a low base rather than compounding quality.
- mediumProfit margin of 6.25% is thin for an upstream operator, and 5-year revenue growth of only 1.9% means any margin compression from crude-price weakness, cost inflation, or renewed subsidy burden flows directly to net income with limited revenue cushion.
- lowPrice is 7.6% below the 50-DMA (₹264.75 vs ₹285.06) with RSI at 32.9, approaching oversold territory; the stock sits in a narrow band between nearest support at ₹259.5 and resistance at ₹271.4, a 4.5% range that constrains near-term price discovery.
- low1-year price-change data is null for all five sector peers, making relative price-performance ranking within the Energy sector unavailable from the current dataset.
Cross-section contradictions
- 5-year revenue growth of 1.9% is near-flat while 5-year earnings growth of 47.8% implies material margin expansion over the same period; the structural driver — cost reduction, subsidy relief, or product-mix shift — is not determinable from available data alone.
- Trailing PE of 8.0 sits 63% below RELIANCE (21.6), yet ONGC quality score (53) is broadly in line with BPCL (55) and well above GAIL (19), suggesting the PE discount is not fully explained by a quality gap relative to direct peers.
For informational purposes only. Not investment advice. VivaTrades is not a SEBI-registered Investment Adviser or Research Analyst. Market data sourced from public feeds; consult a registered adviser before any investment decision.
Fundamentals & technicals: refreshed 8 Jun 2026 · refreshed daily at 01:00 IST
AI synthesis (narrative, snapshot, strengths/weaknesses, peer ranking): generated 6 Jun 2026 · rotates through NIFTY 500 every ~5 days