ONGC Slips Behind Zomato Despite Strong Asset Base
State-owned Oil and Natural Gas Corporation (ONGC), valued at around Rs 3.10 trillion, now trails food delivery platform Zomato despite its vast asset holdings and profitable subsidiaries, sparking debate about the undervaluation of public sector undertakings in India.At the close of trading on Friday, ONGC’s market capitalisation stood at Rs 3.097 trillion—lower than Zomato’s Rs 3.36 trillion, Hindustan Aeronautics Ltd’s Rs 3.23 trillion, and Titan Company’s Rs 3.13 trillion, according to BSE data. Once India’s most valuable firm in 2012, with a market value of Rs 2.44 trillion—surpassing both TCS and Reliance Industries—ONGC has seen its valuation rise just 26 per cent over the past 13 years. In contrast, Reliance has soared from Rs 2.43 trillion in 2012 to Rs 18.7 trillion now, while TCS has expanded nearly fivefold to Rs 10.95 trillion.
Market Value vs Asset Value
Analysts point out that the market has failed to recognise ONGC’s full potential and underlying asset strength. The company holds substantial stakes in major entities, including ONGC Videsh, Mangalore Refinery and Petrochemicals (MRPL), and Hindustan Petroleum Corporation (HPCL). ONGC’s 71.63 per cent stake in MRPL is worth over Rs 18,000 crore, while its 54.9 per cent stake in HPCL is valued at about Rs 52,770 crore. It also holds a 14.20 per cent stake in Indian Oil Corporation worth Rs 31,000 crore and a 5 per cent stake in gas utility GAIL (India) Ltd, valued at approximately Rs 5,900 crore. Together, ONGC’s investments in subsidiaries and minority holdings amount to over Rs 1.07 trillion—more than one-third of its total market capitalisation.
Perception Bias Against PSUs
Oil Minister Hardeep Singh Puri recently expressed concern that state-run oil companies are “significantly undervalued” by the markets, citing a persistent “perception bias” among investors. He emphasised that despite robust profitability and vital contributions to India’s energy security, public sector firms often receive lower valuations than private peers.
In the past six years, the three oil marketing companies—Indian Oil, Bharat Petroleum, and Hindustan Petroleum—have collectively earned Rs 2.5 trillion in profits. Separately, ONGC reported a standalone net profit of Rs 1.16 trillion over the last three financial years and paid a total dividend of Rs 12.25 per Rs 5 share.
Comparing Profits and Market Perception
In contrast, Eternal (formerly Zomato), now valued at Rs 3.36 trillion, posted a net profit of just Rs 527 crore in FY25. Swiggy, another tech-driven peer valued at Rs 1.08 trillion, reported a consolidated loss of Rs 3,116.8 crore for the same period.
Market observers note that this divergence between profitability and valuation underscores how investor sentiment, brand perception, and sector momentum have increasingly favoured new-age digital firms over legacy energy players.
A Case for Revaluation
Experts believe that a reassessment of ONGC’s valuation could better reflect the company’s diversified investments and consistent cash generation capacity. With energy demand projected to rise and the government pushing for greater transparency in PSU management, there is growing anticipation that ONGC’s market value may see an upward revision in the medium term.
As of now, ONGC ranks 25th on the BSE by market capitalisation, well behind India’s top-valued firms—Reliance Industries (Rs 18.7 trillion), HDFC Bank (Rs 15.07 trillion), Bharti Airtel (Rs 11.05 trillion), and TCS (Rs 10.95 trillion). While the market seems to have moved on from the energy giants that once defined India’s corporate power structure, the fundamentals suggest ONGC’s story is far from over—perhaps only undervalued for now.
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