Shares of Oil India fell on Friday, June 12 as Morgan Stanley believes that the stock will show weakness in the next 30 days.
Oil India share price dipped 3% intraday to Rs 416.2 apiece. The scrip was around 2.91% down by 11:38 am, while the benchmark Nifty 50 index was 0.88% up.
Morgan Stanley, in its recent note, maintained 'Underweight' coverage on the stock at a target price of Rs 404, a 5.9% downside from its last closing price of Rs 429.35. The brokerage estimates that the Oil India share price will fall in absolute terms over the next 30 days. The brokerage firm has flagged four key concerns, stating that recent royalty rate changes are expected to have a 5% impact on Oil India's earnings.
Gas average selling price increases are likely to underperform Street estimates. Fuel refining profitability is set to drop by almost half as the impact of tax benefits unwinds. The brokerage also cited headwinds from slower-than-expected pipeline network expansion as an additional drag.
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