Shares of oil marketing companies (OMCs) such as Indian Oil Corporation (IOCL), Bharat Petroleum Corporation (BPCL) and Hindustan Petroleum Corporation (HPCL) slipped up to nearly 5 per cent in the morning trade on Tuesday after reports said the government may sell its entire stake worth a little more than Rs 40,000 crore in BPCL to IOCL.
At 10:28 am, the stock of IOCL was trading over 4 per cent lower at Rs 117.45 apiece on the BSE. It hit a low of Rs 116.70, down 4.69 per cent earlier in the trade. BPCL was quoting 3 per cent lower at Rs 344.40 while HPCL was trading at Rs 252, down 3 per cent. In comparison, the benchmark S&P BSE Sensex was trading over 1 per cent lower at 36,912 levels.
The Centre is planning to offload its entire stake worth a little more than Rs 40,000 crore in Bharat Petroleum Corporation (BPCL), most likely to fellow state-owned oil-marketing company Indian Oil Corporation (IOCL), said a Business Standard report dated September 2. The deal, it said, will go a long way in the Narendra Modi government meeting its highest-ever disinvestment target of Rs 1.05 trillion. READ MORE
If it goes through, an IOCL-BPCL merger will be the third mammoth amalgamation of state-owned companies, excluding banks, in three years — after Oil and Natural Gas Corporation (ONGC)-Hindustan Petroleum Corporation (HPCL) in 2017-18 and REC (formerly Rural Electrification Corporation)-Power Finance Corporation (PFC) in 2018-19.
If IOCL does acquire a majority stake in BPCL, it will create an energy giant, with 42,855 outlets (as of July), or 66 per cent of the retail outlets in India.
That apart, shares of oil and gas explorer ONGC (Oil and Natural Gas Corporation) slipped nearly 3 per cent after a fire broke out at its plant in Navi Mumbai township on Tuesday. READ MORE