🧾 At a Glance:
Oil India Limited (OIL) reported a massive ₹18,999 crore net profit for FY24. Revenue? Over ₹1.14 lakh crore. But earnings per share? Just ₹13.70. Wait… what? Is this PSU magic, share dilution, or a financial illusion? Let’s dig in.
🏢 About the Company
Oil India Ltd is India’s second-largest government-owned exploration and production company. It was founded in 1959, which also happens to be the year Elvis released Jailhouse Rock—but unlike Elvis, OIL is still rockin’… just more in the geopolitical crude sense.
OIL’s business revolves around:
- Crude oil exploration, development, and production
- Natural gas production
- Pipeline transportation and engineering services
- A few side quests in renewable energy—because ESG is the new black.
👨💼 Key Managerial Personnel (KMP)
As per the FY24 report:
- CMD: Dr. Ranjit Rath (also the Oil whisperer of India)
- Director – Finance: Ms. Rupam Banerjee (the lady with the purse strings)
- Company Secretary: Shri Bishnu Prasad Mohapatra
Basically, a PSU dream team that can turn gas into gold—literally.
💰 Financials (FY24 Highlights)
| Metric | FY24 (₹ Cr) |
|---|---|
| Revenue from Operations | ₹1,02,857.8 Cr |
| Other Income | ₹12,013.8 Cr |
| Total Income | ₹1,14,871.6 Cr |
| Total Expenses | ₹98,044.0 Cr |
| Profit Before Tax (PBT) | ₹16,827.6 Cr |
| Profit After Tax (PAT) | ₹18,999.0 Cr 🤑 |
| EPS (Basic & Diluted) | ₹13.70 |
| Equity Share Capital | ₹13,866.4 Cr |
| Reserves | ₹1,60,785.3 Cr |
And here’s the “wait for it” part: the company made ₹19K crore in profit, but the EPS is only ₹13.70. That’s because there are more shares floating around than memes on the internet.
📈 Forward-Looking Fair Value (FV) Calculation
Let’s calculate the fair value using current CMP (as of today from Trendlyne) and industry P/E expectations.
- 🟢 Latest CMP: ₹694.70
- EPS (FY24): ₹13.70
- Current P/E: 50.7x
- Industry Median P/E (Oil & Gas – PSU): ~7.5x
- FV Estimate (Conservative): ₹13.70 × 7.5 = ₹102.75
- FV Estimate (Aggressive): ₹13.70 × 10 = ₹137
🤡 Verdict: CMP is already 6x above conservative FV. Unless OIL becomes a SaaS company, this stock’s rally might be… well, overcooked?
🚀 Estimated Growth & Industry Outlook
- Oil prices are globally cooling due to economic slowdown fears and transition to renewables.
- PSU stocks have seen a re-rating rally—but some are now flying higher than Jet Airways ever did.
- OIL’s reserves are declining marginally each year, and future growth depends on exploration success or global crude price shocks (and not the good kind).
In short: good business, but don’t mistake a one-time PSU rally for multibagger fundamentals.
🧠 EduInvesting Take
Let’s say this loud and clear for the folks in the back:
“₹18,999 crore profit ≠ undervalued stock”
- Yes, OIL is profitable.
- Yes, it’s a dividend payer.
- But valuations are bloated like a stuffed samosa.
- EPS is flat YoY. Margins are okay. Revenue grew a bit. But CMP has outpaced logic.
If you bought this at ₹300 last year, congratulations—sell a little and take your wife to Bali. But if you’re buying at ₹700 hoping for ₹1400? Well… may OPEC bless your dreams.
⚠️ Risks & Red Flags
- Geopolitical tension = Crude price volatility
- Overdependence on oil = No real diversification
- Diluted share capital = Earnings get spread thinner than butter on airline toast
- PSU fatigue: One bad news from govt and these stocks fall like Jenga blocks
🏁 Final Word
OIL India is no doubt a money-printing machine, but that doesn’t mean you pay any price for it. In fact, current valuations scream “exit” more than “entry.”
And remember: PSU rallies come with a built-in expiry date—like milk cartons. Don’t get stuck with curd.
📝 Written by Prashant Marathe
📅 Published: May 19, 2025
🏷️ Tags: oil india, PSU stocks, FY24 results, oil and gas earnings, eduinvesting, Trendlyne CMP, PSU valuation, oil india analysis, overvalued stocks, oil sector outlook, FY25 preview, oil india fair value
