2 PSU Stocks: 1 Defence, 1 Oil & Gas Stocks To BUY/SELL After Big Rs 1,486 Crore Deal; 45-91% Returns YTD

Two PSU giants belonging to defence and oil and gas sector are in focus. One is defence PSU major Mazagon Dock Shipbuilders, the other is government-backed oil and gas explorer, ONGC. In a major development, Mazagon Dock bagged a award worth over Rs 1,486 crore.

As per the regulatory filing, Mazagon Dock Shipbuilders Limited (MDL) has received a Notification of Award of Contract on 05 September 2024 from Oil and Natural Gas Corporation Limited (ONGC) for Pipeline Replacement Project 8 Group A (PRP 8 Group A) on EPC reimbursable basis (OBE) at the ceiling price of INR 1486,40,32,996/- (Indian Rupees One Thousand Four Hundred Eighty-Six Crores Forty Lakhs Thirty-Two Thousand Nine Hundred and Ninety-Six only) including all taxes and duties (GST@12%).

The order is for Subsea Pipeline Replacement Project.

On BSE, both Mazagon Dock and ONGC shares tumbled by 1% to 3.5%, and ended at Rs 4352.75 apiece and Rs 298.95 apiece respectively. YTD, Mazagon Dock shares have zoomed by 90.6%, and that of ONGC stock has rallied by 45.6%.

Which PSU stocks to buy?

As per Antique Stock Broking, ONGC is recommended to BUY for a target price of Rs 345, while Mazagon Dock is also advised to BUY for a target of Rs 3,548.

Meanwhile, JM Financial has suggested BUY on ONGC for target of Rs 340.