Mumbai: Brokerage UBS has raised price targets on Indian oil marketing companies Bharat Petroleum Corp (BPCL), Hindustan Petroleum (HPCL) and Indian Oil (IOC). While upgrading the ratings for IOC and HPCL to ‘buy’, from ‘neutral’ and maintaining ‘buy’ for BPCL, the firm said it sees 16-18% upside in shares.
UBS expects global oil markets to ease in October-December.
“In upcoming quarters, crude price moderation could expand integrated margins for Indian SOE (state owned enterprises) OMCs to ₹14-15/ltr (long-term average: ₹10-11/ltr),” said UBS in its client notes. “We do not foresee any retail fuel price cuts if crude stays above or near US$80/barrel.” “Our cautious view on refining translates to profit shifting from refining to marketing, given India’s unchanged retail fuel prices.”
ET Bureau
