State-run oil producer Oil India Ltd announced last week that it won two blocks in discovered small field (DSF) round-II bidding. Any excitement about this development is premature at this point. That’s because it will be a good 4-5 years for monetization to reflect in the numbers, said analysts, adding that the exact potential of volumes is not yet known.
Sure, the Oil India stock increased by 2% on Monday. However, it was also a day when broader markets were in a cheerful mood, with the National Stock Exchange’s Nifty 500 index closing 1.5% higher.
From a medium-to-long term perspective, the performance of Oil India shares has been on a slippery slope. The stock has underperformed the Nifty 500 index so far this year, declining by 18%.
