ONGC Share Price: Two major brokerages say stay away – could it drop further?

Shares to Sell: Shares of Oil and Natural Gas Corporation (ONGC) were trading at Rs 253 on Wednesday following the company’s Q2FY26 results, which came in below market expectations. Investor sentiment appeared cautious, as analysts pointed out limited drivers for near-term growth.

Goldman Sachs maintains sell rating on ONGC

Goldman Sachs kept a Sell rating on ONGC, revising the target price slightly to Rs 220 from Rs 205. The brokerage noted that rising operating costs have put pressure on profit margins, while oil production is expected to remain largely stable in the near term. Without any significant catalysts, the report suggested that the stock could continue to face downward pressure.

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Citi keeps sell call on ONGC

Citi also maintained a Sell rating, raising the target to Rs 225 from Rs 205. The brokerage highlighted that oil and gas volumes are unlikely to increase substantially, with management guidance for FY26 and FY27 set at 19.8 million tons and 21 million tons of oil, respectively. Citi also noted that operating costs are rising and the gas segment faces ongoing pressure, limiting potential upside for the stock.

Nomura lowers target price

Nomura kept a Neutral rating but reduced the target price to Rs 270 from Rs 275. The brokerage stated that Q2 results were weaker than expected due to higher operational expenses. Nomura projected moderate volume growth of around 4 per cent CAGR through FY28 and reported management guidance for oil and gas production of 19.8/21 million tons and 20/21.5 bcm, respectively, for FY26/27.

Key points for investors

ONGC continues to supply a large portion of India’s energy needs, making it central to the country’s energy strategy. Analysts pointed out several factors affecting performance: rising operating expenses, pressure on gas and export pricing, and moderate growth guidance for FY26-FY27. The company has also begun renewable energy projects and cost-cutting measures, but the effects on profitability are likely to be gradual rather than immediate.

At the current price of Rs 253, ONGC trades at an 8–10 per cent discount relative to historical levels. Brokerages indicate that near-term movement is likely to remain restricted, and investors may want to observe developments closely before taking new positions.