Rally in state-run oil firms overdone: Nomura

Tags: News
Nomura said the rally in India's state-run oil companies on Friday, spurred by the government's announcement to allow higher diesel prices, was excessive and the action would not lead to any improvement in the bottom line of these companies.

"We reiterate that yesterday's actions are not a big reform, and there may not be much reduction in oil marketing companies' overall under-recoveries," Nomura wrote in a note on Friday.

"Also, even as under-recoveries reduce, these may not result in any improvements in the bottom line of companies, in our view," the analysts added.

Nomura maintained its 'reduce' rating on Oil and Natural Gas Corp and Oil India Ltd.

Shares of state-run companies surged for a second session on Friday after the government's diesel announcement.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Banks must learn from past mistakes to promote financial inclusion

    Prime minister Narendra Modi launched a massive financial inclusion programme yesterday titled “pradhan mantri jan dhan yojana’ (PMJDY), that will

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Urs Schöttli

West Asia turmoil worries east Asia

From Beijing to Jakarta, from Manila to Tokyo, east Asian ...

Parvez Imam

Sowing the seeds of love for hatred

No wonder we have a whole lot of talking going ...

Dharmendra Khandal

Time to protect our endangered wildlife species

After 65 million years of existence, the earth’s biodiversity is ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture