President of India-backed company signs of heads of agreement with Mitsui O.S.K Lines Ltd, Japan

Oil and Natural Gas Corporation Limited (ONGC) and Mitsui O.S.K Lines Ltd, Japan (MOL) have entered into a Heads of Agreement on July 3, 2025, to form a partnership for the construction, ownership, and operation of two Very Large Ethane Carriers (VLECs). These VLECs will be instrumental in transporting imported ethane to ONGC Petro Additions Limited (OPaL), an ONGC subsidiary, for its captive use as feedstock. This collaboration is contingent upon receiving Board approval, and further specifics will be disclosed once the definitive partnership agreement is signed.

Oil & Natural Gas Corporation Ltd (ONGC) stands as India's largest crude oil and natural gas company, playing a dominant role by contributing approximately 71 per cent of the nation's domestic production. Specializing in the exploration and production of these vital resources, ONGC is also involved in various international joint ventures for oil fields across countries such as Vietnam, Norway, Egypt, Tunisia, Iran, and Australia. Domestically, the company is responsible for roughly 70 per cent of India's crude oil output and about 84 per cent of its natural gas production.

The company has a market cap of over Rs 3 lakh crore and has been maintaining a healthy dividend payout of 38 per cent. The shares of the company have a PE of 8.5x whereas the industry PE is 13x. The stock is up by 20 per cent from its 52-week low of Rs 205 per share. The President of India holds 58.89 per cent stake and Life Insurance Corporation of India (LIC) holds 9.29 per cent stake.

Disclaimer: The article is for informational purposes only and not investment advice.