State-owned oil and gas company ONGC has become cheapest globally as earlier this week company’s stock price fell below Rs 100 for the first time in past 15 years. At present, ONGC trades at 4.2 times its estimated one-year forward earnings. Most global oil and gas majors command a price-to-earnings ratio of more than 15. Exxon Mobil and Saudi Arabian Oil Company (Saudi Aramco) have a P/E of 18.3 times and 17.3 times, respectively. While ONGC has always traded at a discount to its global peers, it has widened to record levels in recent months.
ONGC historically has traded at a discount versus global peer group, but over the past 12 months, the discount has widened materially. The the brokerage has a buy rating on the stock, albeit it has cut the price target from Rs 190 to Rs 172 due to a cut in earnings estimates amid weak global oil prices.