BPCL, HPCL, IOC shed up to 8% on petrol, diesel price cut, margin worries

Analysts expect OMCs to trade lower in the near-term given the retail price cut and elevated brent crude prices of $85/bbl

Investors shunned shares of oil marketing companies (OMCs) on Friday as they feared the government's decision to cut retail prices of petrol and diesel could hurt the companies' profit margins in the near-term. 
 

On Thursday, the government announced that OMCs will reduce pump prices of petrol and diesel after a record 22 months, making them cheaper by Rs 2 per litre in the national capital. The changes, were effective Friday onwards.
 

As there is no indication of any excise duty relief from the central government, analysts expect OMCs to bear the cost of this price cut. 
 

Reacting to the development,