IIFL Securities Stock Market Watch Today: Buy Indian Oil Corp - April 02

IIFL Securities recommends buying Indian Oil Corp shares at the current market price of Rs 171.9, expecting a potential upside of 4.14%. The target price set by the brokerage firm is Rs 179. This buy call is based on the company's robust financial performance, strong refining margins, and government support for oil and gas exploration. Additionally, the ongoing Russia-Ukraine conflict has created supply disruptions, leading to higher oil prices, which may benefit Indian Oil Corp's earnings.

About Indian Oil Corp:

Indian Oil Corporation (IOC) is the largest commercial oil company in India, with a significant presence in refining, marketing and distribution of petroleum products. It operates 11 refineries in India, with a total refining capacity of over 80 million metric tonnes per annum (MMTPA). IOC also holds a significant share in the Indian fuel retail market, with over 35,000 fuel stations spread across the country. The company is involved in various aspects of the oil and gas industry, including exploration, production, transportation and storage. IOC is committed to sustainable growth, with a focus on clean energy and environmental protection.

52 Week Price Trend:

Indian Oil Corp (IOC) is currently trading at Rs 171.9, well within its 52-week range of Rs 75.75 to Rs 196.8. Over the past year, IOC has experienced significant volatility, driven by fluctuations in global oil prices and the broader economic environment. Despite the recent decline from its 52-week high, IOC remains a fundamentally sound company with a robust balance sheet and a strong market position in the Indian petroleum sector. Analysts are generally optimistic about IOC's long-term prospects, as the company is expected to benefit from the growing demand for energy in India.

Stratzy's MOST Analysis:

IOC has been rated BBB by Stratzy's MOST framework, which assesses Management, Outlook, Safety, and Trend. This rating indicates a medium risk level and suggests that IOC has a balanced combination of strengths and weaknesses in these four areas. IOC's management is considered competent, and the company has a positive outlook. However, its safety record and overall trend may be areas of concern. This rating provides insights into IOC's fundamental risks, allowing investors to make informed decisions based on their risk tolerance.

Company's Fundamentals:

Indian Oil Corp (IOC) stock is currently undervalued as indicated by its low Price-to-Earnings (PE) ratio of 5.35, which means investors are paying only 5.35 times the company's annual earnings for each share they own. The Price-to-Book (PB) ratio of 1.5 suggests that the market value of the company's assets is only 1.5 times its book value, indicating potential upside. Moreover, IOC offers a compelling Dividend Yield of 2.82%, providing investors with a steady stream of passive income.

Fundamental and Technical information provided in this blog were last updated on 02 Apr, 2024

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