ONGC's valuations of just 5x FY27E PER, 2.5x EV/Ebitda & 0.7x P/BV are attractive and underplay the 9% CAGR in consolidated EPS over FY26–28E, dividend yield of 5–6% and RoE/ROCE of 14–15% in FY27E.
ONGC recently signed BP Plc, UK as a technical services provider for its western offshore assets. BP has committed up to 60% incremental production over base levels of ~40mmscmd of gas and ~0.25mb/d of oil over the 10-year contract period. Achievement of even part of the stated target can meaningfully transform ONGC’s production profile over the next five–seven years.