Reiterate 'buy' on BPCL - TP hiked to Rs.802 - Geojit BNP Paribas

- Buy rating on BPCL has been reiterated with an increased target price of Rs.802. Earlier target price was Rs.735.

- It has been announced another exploration discovery 'Atum' in the offshore Area 1 of the Rovuma basin. It is the second discovery after Golfinho. Recoverable reserve of both the discoveries put together is estimated at 27-60 tcf of natural gas.

- After the Atum discovery, the consortium has planned to drill four appraisal wells and this will further strengthen the reserve potential and further explore the potential upside from the Mozambique block, which is currently in the range of 100 tcf.

- Focus will also be on the drilling results from Black Pearl and Barracuda wells.

- E&P valuation has increased from Rs.196 to Rs.259 to account for increase in reserves of Atum and Golfinho complexes and the target price has been hiked to Rs.802.

- It is expected that the coming year would continue to excite on the E&P business.

Source : Equity Bulls

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