Oil India shares jumped 5% to Rs 261.45 on the BSE in intraday trade on Monday as Brent crude prices surged after Saudi Arabia raised rates for its crude shipments in July. 

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The company’s shares were trading around its 52-week high of Rs 267.70, set on October 1, 2021. It has outpaced the market in the last week, rising 17% versus a 0.61% fall in the S&P BSE Sensex.

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According to Reuters, oil prices surged more than $2 in opening trade on Monday as Saudi Arabia hiked pricing dramatically for its crude sales in July, indicating how tight supply remains despite OPEC+’s agreement to accelerate output increases over the following two months.

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The company recorded robust profitability in the March 2022 quarter (Q4FY22), with turnover and profit after tax (PAT) rising by 74% and 92%, respectively. In Q4FY22, the company announced its record high quarterly net profit of Rs 1,630 crore, as it got over $100 per barrel for oil produced and sold. The net profit nearly doubled during the quarter, compared to Rs 847.56 crore profit in the same time the previous year.

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After a rise in crude price and an improvement in domestic gas pricing, analysts at HDFC Securities believe that Oil India is a worthy ‘buy.’

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“A target price of Rs 300 is premised on an increase in crude price realisation and improvement in domestic gas price realisation. Oil price realisation for FY22 improved to $76.7/bbl, vs $43/bbl in FY21, given the expected global economic rebound, post Covid-19,” the brokerage firm had said in a Q4FY22 result update report.

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Likewise, ONGC shares rose 2% to Rs 154.30 on the BSE.  HDFC Securities has a ‘buy’ rating on ONGC with a target price of Rs 220.