The Oilfields (Regulation and Development) Amendment Bill, 2024 was recently passed by the Rajya Sabha and is yet to be passed by Lok Sabha. This bill is aimed at improving the operational landscape for Indian oil companies by delinking petroleum operations from mining. This separation introduces a new ‘petroleum lease’ concept which streamlines regulations and reduces uncertainty, which is expected to attract foreign investment.
The bill also expands the definition of mineral oils to include various hydrocarbons while facilitating easier exploration. Additionally, it promotes a green agenda by mandating carbon emission reporting and encouraging renewable energy projects, providing a more stable and investor-friendly environment for oil companies in India. From these initiatives, some Indian companies might benefit from this bill.
Listed below are some of the stocks to benefit from the passing bill in Rajya Sabha to boost investment in oil and gas exploration
Oil & Natural Gas Corporation
Oil and Natural Gas Corporation Limited is India’s largest crude oil and natural gas producer which contributes approximately 71 percent of domestic production. Their business model focuses on exploration, refining, production, and marketing of oil and gas, along with petrochemicals and renewable energy initiatives. ONGC operates both domestically and internationally, ensuring energy security and sustainable growth.
With a market capitalization of Rs. 3,27,150 Crores, the shares of Oil & Natural Gas Corporation Limited closed at Rs. 260.05 per equity share, down 0.44 percent from its previous day’s close price of Rs. 261.20.
Its Revenue from operations grew by 7.25 percent from Rs. 1,47,614 Crores in Q2FY24 to Rs. 1,58,329 Crores in Q2FY25, accompanied by profits of Rs. 16,171 Crores to Rs. 9,878 Crores.
Oil India
Oil India Limited is an energy company in India that is engaged in the exploration, production, and crude oil and natural gas transportation. Their business model focuses on upstream operations which include drilling and reservoir management alongside downstream activities such as liquefied petroleum gas production. Oil India also has international interests in various countries and operates renewable energy projects while ensuring a comprehensive approach to energy solutions.
With a market capitalization of Rs. 77,272 Crores, the shares of Oil India Limited closed at Rs. 475.05 per equity share, down 0.24 percent from its previous day’s close price of Rs. 473.75.
Its Revenue from operations declined by 3.33 percent from Rs. 7,497 Crores in Q2FY24 to Rs. 7,247 Crores in Q2FY25, accompanied by profits of Rs. 640 Crores to Rs. 2,069 Crores.
Vedanta
Vedanta Limited is a diversified natural resources conglomerate that operates in sectors such as oil and gas, power, and metals. Their business model focuses on exploration, mining, processing, and exporting various minerals, including zinc, copper, lead, and aluminum. They focus on sustainable practices and aim to create long-term value.
With a market capitalization of Rs. 1,96,008 Crores, the shares of Vedanta Limited closed at Rs. 501.25 per equity share, up 6.15 percent from its previous day’s close price of Rs. 472.20.
Its Revenue from operations declined by 3.36 percent from Rs. 38,945 Crores in Q2FY24 to Rs. 37,634 Crores in Q2FY25, accompanied by a loss of Rs. 915 Crores to a profit of Rs. 5,603 Crores.
Hindustan Oil Exploration Company
Hindustan Oil Exploration Company is an Indian company that is focused on the exploration and production of hydrocarbons which includes crude oil and natural gas. Their business model centers on operating multiple oil and gas blocks across India, providing geological services, and engaging in joint ventures to improve resource extraction. The company aims to leverage advanced technologies and sustainable practices to optimize production.
With a market capitalization of Rs. 2,597.92 Crores, the shares of Hindustan Oil Exploration Company Limited closed at Rs. 196.45 per equity share, down 0.18 percent from its previous day’s close price of Rs. 196.80.
Its Revenue from operations declined by 16 percent from Rs. 113 Crores in Q2FY24 to Rs. 95 Crores in Q2FY25, accompanied by a profit of Rs. 43 Crores to Rs. 11 Crores.
Written by Santhosh S
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