Shares of Oil and Natural Gas Corp. Ltd (ONGC) fell around 1.5% on Wednesday to touch a multi-year low, while the Nifty 50 index gained 6.6%. “ONGC’s one-year forward EV/ Ebitda is currently two standard deviations below its 12-year average.
Such low valuations were last seen during the global financial crisis in 2008," said Amit Shah, head of India equity research at BNP Paribas India.
Standard deviation measures the variations from average in a data set. EV is enterprise value. Ebitda is earnings before interest, tax, depreciation and amortization.
On Tuesday, Moody’s Investors Service downgraded ONGC’s local and foreign currency issuer ratings from Baa1 to Baa2. The agency said the downgrade indicates that the company’s credit metrics