ONGC is India's leading integrated oil and gas company, accounting for around 75 per cent of crude oil and natural gas production by volume, and 17 per cent of domestic refining capacity. Hence, higher crude prices are beneficial for the company.
The S&P BSE OIL & GAS index, on the other hand, was trading over 0.8 per cent lower at 9,727.37 levels whereas the benchmark S&P BSE Sensex was trading around a per cent lower at 28,002-mark.
ICICI Securities notes that the likely output cut deal may put floor under oil price and that would be positive for ONGC. The brokerage maintains "HOLD" rating on the stock with the target price of Rs 66.
Centrum Broking Wealth notes that the carnage by Coronavirus
(Covid-19) pandemic is expected to severely impact earnings of oil & gas companies for the March quarter.
Among paint stocks, Asian Paints was trading nearly 4 per cent lower at Rs 1,543 apiece while Berger Paints was down around 5 per cent at Rs 462. Kansai Nerolac was down 2.6 per cent at Rs 377. In Aviation sector, SpiceJet was down 5 per cent at Rs 40.6 and InterGlobe Aviation was trading at Rs 979, down 2 per cent.
Despite the huge gains, oil prices have still lost more than half their value this year. The market slumped in early March, when Saudi Arabia and Russia were unable to come to terms on a deal to curb production, and the Saudis boosted output to more than 12 million bpd and shipped discounted cargoes worldwide.