ONGC - Fundamental Analysis: Financial Health & Valuation
Back to ListFundamental Rating: 4.1
| Stock Code | ONGC | Market Cap | 3,76,842 Cr. | Current Price | 300 ₹ | High / Low | 308 ₹ |
| Stock P/E | 11.5 | Book Value | 267 ₹ | Dividend Yield | 4.09 % | ROCE | 14.8 % |
| ROE | 11.4 % | Face Value | 5.00 ₹ | DMA 50 | 278 ₹ | DMA 200 | 260 ₹ |
| Chg in FII Hold | 0.54 % | Chg in DII Hold | -0.39 % | PAT Qtr | 8,372 Cr. | PAT Prev Qtr | 9,848 Cr. |
| RSI | 69.1 | MACD | 5.48 | Volume | 1,86,73,442 | Avg Vol 1Wk | 2,68,21,467 |
| Low price | 226 ₹ | High price | 308 ₹ | PEG Ratio | -2.81 | Debt to equity | 0.10 |
| 52w Index | 90.2 % | Qtr Profit Var | 1.60 % | EPS | 26.0 ₹ | Industry PE | 28.2 |
📊 ONGC presents strong fundamentals with ROE at 11.4% and ROCE at 14.8%, reflecting efficient capital utilization. The P/E ratio of 11.5 is significantly lower than the industry average of 28.2, suggesting undervaluation. Dividend yield of 4.09% adds income appeal for long-term investors. Debt-to-equity ratio of 0.10 highlights financial stability. However, the negative PEG ratio (-2.81) indicates limited earnings growth visibility, and RSI at 69.1 suggests near overbought conditions.
💰 Ideal Entry Price Zone: 270 ₹ – 285 ₹, closer to its 50 DMA (278 ₹), offering a safer entry aligned with valuation support.
📈 Long-Term Holding Guidance: ONGC is suitable for long-term holding (5+ years) due to strong fundamentals, dividend yield, and low debt. Investors may consider partial profit booking near 305–310 ₹ resistance while retaining core holdings for compounding returns.
✅ Positive
- Low P/E (11.5) compared to industry average (28.2), indicating undervaluation.
- Strong ROCE (14.8%) and ROE (11.4%).
- Dividend yield of 4.09% provides steady income.
- Low debt-to-equity ratio (0.10) ensures financial stability.
⚠️ Limitation
- PEG ratio (-2.81) suggests weak earnings growth outlook.
- RSI at 69.1 indicates near overbought conditions.
- Quarterly PAT declined from 9,848 Cr. to 8,372 Cr.
📉 Company Negative News
- Quarterly PAT decline highlights earnings pressure.
- DII holding decreased (-0.39%), showing reduced domestic institutional interest.
📈 Company Positive News
- FII holding increased (+0.54%), reflecting foreign investor confidence.
- MACD positive (5.48), supporting bullish technical momentum.
🏭 Industry
- Industry P/E at 28.2, much higher than ONGC’s 11.5, making ONGC undervalued relative to peers.
- Energy sector benefits from global demand but is sensitive to crude price fluctuations and policy changes.
🔎 Conclusion
ONGC is a fundamentally strong, undervalued stock with attractive dividend yield and low debt. It is a good candidate for long-term investment, especially for income-focused investors. Entry near 270–285 ₹ offers better risk-reward. Current holders should maintain positions for 5+ years, booking partial profits near highs but retaining core holdings for sustained growth and dividends.