ONGC: Undervalued Giant with 6% Dividend Yield

$ONGC Oil and Natural Gas Corporation ONGC stands as one of India profitable giants trading below book value with dividend yield up to 6 percent. This state owned energy major presents compelling case for shareholders seeking value and income. The stock trades at 0.83 times book value, meaning investors buy at 17 percent discount to accounting net worth. ONGC has book value per share of Rs 280 while market price sits around Rs 246 to Rs 250, representing 12 percent discount. Price to book ratio of 0.81 to 0.94 signals significant undervaluation. ONGC delivers dividend yield between 5.00 percent and 6.2 percent, one of highest in Nifty 50. Company maintains healthy payout ratio of 33.4 percent to 38 percent. For FY26, ONGC announced final dividend of Rs 1 per equity share. In past three years company paid Rs 10.5 in FY22, Rs 11.25 in FY23, and Rs 12.25 in FY24. Financial performance shows strong momentum. Q4 FY26 net profit surged 45 percent year on year to Rs 10,820 crore. Q4 revenue came at Rs 1,73,805 crore, up 3.6 percent. Full year FY26 revenue was Rs 6,62,247 crore while PAT surged 14.3 percent to Rs 41,424 crore from Rs 36,226 crore, marking record year. Company achieved ROE of 14.6 percent for FY24, surpassing five year average of 12.06 percent. ONGC trades at P/E of 7.17 to 8.7, in line with industry average 7.26. For shareholders, this proves highly beneficial. Buying below book value with 6 percent yield creates double advantage. Discount provides safety cushion while yield delivers steady income. Record profits of Rs 41,424 crore demonstrate earnings strength supporting dividend sustainability. About 71 percent analysts recommend Buy with Rs 310 target, implying 28 percent upside. However, shareholders note sensitivity to global oil prices around $70 per barrel