ONGC shares rally 6% after govt cuts crude oil royalty; CLSA explains why it’s a big boost

ONGC shares surged 6% after CLSA termed the government’s decision to cut crude oil and natural gas royalty rates a major positive for upstream producers. The brokerage said the move could raise ONGC’s fair value by 7-9% and Oil India’s by 9-11%. Oil India shares also gained 7.5%, while CLSA maintained a ‘High Conviction Outperform’ rating and Rs 405 target price.

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