Indian Oil Corporation (IOC) — Journal Entry NoTradeZone Series
| Date | Stock | Entry Price | Position |
|---|---|---|---|
| 22 Apr 2026 | IOC | ₹147 | Lot 1 |
Why Now
IOC had run up to ₹188. By April 22nd it was sitting at ₹147 — roughly 22% off the high. That kind of drawdown on a PSU this size, with dividends still intact and promoter holding unchanged, is what I wait for.
This wasn’t a sudden decision. I’d been watching for weeks. Volumes were quieter. The stock was going sideways. No big news driving it down — just selling pressure running out of steam.
At ₹147 the numbers made sense to me. 5.6x earnings. Around 5% dividend yield. 51.5% promoter holding. Trading near book value of ₹140.
You’re not betting on a recovery. You’re getting paid to wait while the range resets.
That’s enough.
The Business
Indian Oil Corporation is India’s largest oil refiner and fuel retailer. Government owned — 51.5% promoter holding. Petrol pumps, refineries, pipelines. The kind of business that doesn’t disappear.
The model is straightforward — refine crude, sell fuel, collect margin. The problem is those margins fluctuate with crude prices and government retail pricing decisions. When crude is elevated and retail prices are capped, margins compress. That’s exactly the situation when I entered.
This isn’t a high-growth story. It’s a range story. IOC has historically traded in a predictable band — the entry thesis is that the range resets, not that the business transforms.
The Range
| Level | Price |
|---|---|
| Recent high | ₹188 |
| 52-week low | ₹130 |
| Entry — Lot 1 | ₹147 |
| Down from high | ~22% |
| Lot 2 added | ₹133 — 20 May 2026 |
| Exit target | ~₹175 (20% from Lot 1) |
Entry at ₹147 sits in the lower third of the range. When price approached ₹133 in May with volumes drying up post results, I added Lot 2. Averaging and exit levels will move if the thesis changes materially.
The Risk
Two risks I accepted going in.
Crude oil. Trump’s stance on Iran keeps supply unpredictable. A sustained spike in Brent above $85-90 compresses IOC’s refining margins in ways I can’t model precisely. This is the nature of an oil company — you’re always one geopolitical event away from a margin shock.
Government policy. Retail fuel prices in India are politically sensitive. When crude rises, the government sometimes delays passing on cost increases to consumers. IOC absorbs that. It’s not a business risk — it’s a policy risk. And it’s real.
Neither of these breaks the thesis today. But either could.
This thesis breaks if refining margins remain structurally impaired across multiple quarters, especially if dividend payouts weaken materially as a result.
What I’m Watching
- Crude oil direction — Brent sustained above $85 is a pressure point
- US-Iran developments — any escalation affects supply assumptions
- Quarterly marketing margins — the clearest signal of thesis health
- ₹115-120 zone — if approached with thesis intact, possible Lot 3 consideration. Decision will be made then, not now.
- Dividend consistency — Q4 FY26 declared ₹1.25 per share
Current Status
Both lots active. Lot 1 at ₹147, Lot 2 at ₹133.
Q4 FY26 results confirmed thesis intact. Net profit +81% YoY to ₹15,176 crore. Revenue +7% YoY. Final dividend ₹1.25 per share declared. Marketing margins were under pressure due to West Asia conflict — expected, not structural. Business intact.
Monitoring crude direction and marketing margin recovery in Q1 FY27.
This entry will be updated when something material changes — results, averaging, exit or thesis break. Not before.
Journal Timeline
| Date | Event | Status |
|---|---|---|
| 22 Apr 2026 | Initial entry — Lot 1 at ₹147 | Active |
| 18 May 2026 | Q4 FY26 results — ₹1.25 final dividend declared. Marketing margins under pressure. Thesis intact. | Reviewed |
| 20 May 2026 | Lot 2 added at ₹133 — volumes drying up, averaging level reached | Both Lots Active |
This timeline updates when something material changes — results, averaging, exit or thesis break. Not before.
Related Reading
About the Author
Jonathan — Endurance athlete. Investor by discipline. I document real trades in real time — entry prices, thesis, risks and honest updates. No tips. No calls. Just disciplined thinking, publicly archived.
All views expressed are personal. This is not investment advice. Please consult a SEBI registered advisor before making investment decisions.