Name: Berkshire

StockANALYSIS Indian Oil Corporation Limited

OUR RECOMMENDATION

• Fair Value: 208

• Rating: Buy
• Risk Rating (Using Altman’s Z Score): Safe
 INDUSTRY OVERVIEW
MARKET SHARE
1. India retained its spot as the third largest consumer of
oil in the world in 2017 with consumption of 4.69
thousand barrels per day
.2. India was the fourth-largest Liquefied Natural Gas
(LNG) importer in 2017 after Japan, South Korea and
China. LNG imports increased to 26.11 bcm in 2017-18
from 24.48 bcm in 2016-17.
3. Oil imports rose sharply to US$ 87.37 billion in 2017-
18 from US$ 70.72 billion in 2016-17.
INVESTMENTS
1. The petroleum and natural gas sector attracted FDI
worth US$ 7.00 billion between April 2000 and
December 2018.(as per Department of Industry Policy
and Promotion).
1.2. Foreign investors will have opportunities to invest in
projects worth US$ 300 billion in India, as the country
looks to cut reliance on oil imports by 10 per cent by
2022, according to Mr Dharmendra Pradhan, Minister of
Petroleum and Natural Gas, Government of India.
2.3. Oil and Natural Gas Corporation (ONGC) is going
to invest Rs 17,615 crore (US$ 2.73 billion) on drilling oil
and gas wells in 2018-19.
3.4. In September 2018, the Government of Gujarat
selected Energy Infrastructure Limited (EIL), a subsidiary
of the Netherlands-based Energy Infrastructure Butano
(Asia) BV, to set up a Liquefied Petroleum Gas (LPG)
terminal at Okha with an investment of Rs 700 crore
(US$ 104.42 million).
Government initiatives
1. The Government of India is planning to set up around
5,000 compressed bio gas (CBG) plants by 2023.
2. Government of India is planning to invest Rs 70,000
crore (US$ 9.97 billion) to expand the gas pipeline
network across the country.
3. State-run oil firms are planning investments worth Rs
723 crore (US$ 111.30 million) in Uttar Pradesh to
improve the liquefied petroleum gas (LPG) infrastructure
according to Mr Dharmendra Pradhan, Minister of
Petroleum and Natural Gas, Government of India.
4. The Oil Ministry plans to set up bio-CNG
(compressed natural gas) plants and allied infrastructure
at a cost of Rs 7,000 crore (US$ 1.10 billion) to promote
the use of clean fuel.
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Brent Price ($ per barrel)

Jan 13, 2016

Nov 17, 2015
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SHARE PRICE VS. BRENT

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Recent drop in stock price was escalated due to recently applied cess of 1%.

Mar 19, 2018

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Stock price

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