Shares of Oil India Ltd today gained 2.2 per cent as Kotak Securities has upgraded the stock to “buy’’ from “add’’.

“We believe stock is discounting a fairly bleak scenario of no improvement in net crude realisations after subsidy burden,’’ Kotak says.

Inexpensive valuations and good dividend yield of 5 per cent will provide adequate support on downside, it says.

“We believe the valuation gap between Oil India and ONGC may narrow over the next 12 months,’’ the report says.