ONGC shares jump 6% as royalty cuts spark a CLSA upgrade for upstream oil firms

Fair value could rise up to nine percent

ONGC shares surged around 6% after CLSA said the government’s cut to crude oil and natural gas royalty rates is a major tailwind for upstream producers. The brokerage estimates the change could lift ONGC’s fair value by about 7–9% and Oil India’s by 9–11%, while Oil India shares gained roughly 7.5%. CLSA keeps a high-conviction outperform call.