BPCL jumps 7% on reports of govt mulling stake sale

BPCL jumps 7% on reports of govt mulling stake sale

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Shares of Bharat Petroleum Corporation gained 7 percent intraday on September 13 after a media report indicated that the government may be considering stake sale to a private player.

The stock rallied 20 percent last month. It was quoting at Rs 408, up Rs 23.75, or 6.18 percent on the BSE at 1422 hours IST.

Earlier media report indicated that oil ministry proposed the government to sell stake in BPCL to IOC but finance ministry opposed the same, reports CNBC-TV18 quoting unnamed sources.

The channel said Finance ministry believes the acquisition of BPCL stake by IOC may create competition issues and the Competition Commission of India’s approval for the same may be challenging. The ministry is of opinion that IOC is already over-leveraged.

IOC has a debt of Rs 72,000 crore and has capex plans of Rs 25,000 crore for FY20.

BPCL’s stake sale to private strategic partner will bring in competition in fuel retailing and fuel retailing business will see competitive pricing if stake in BPCL divested to private companies, the report said.

SP Tulsian of sptulsian.com, in an interview to the channel, said this news is seen quite positive and even the government in its Budget indicated about strategic divestment in PSUs.

One divestment is Air India and second is BPCL, hence it is a clear direction that government taking big reforms forward, he said, adding acquisition if it happens will lay roadmap, foreign capital coming and the entire thing will be seen positively by the market.

Currently the government held 53.29 percent stake in the company.

IOC gained 4 percent, HPCL rallied 6 percent, ONGC more than 2 percent, GAIL India 2 percent and Oil India up 1.5 percent at the time of publishing this copy.Get access to India’s fastest growing financial subscriptions service Moneycontrol Pro for as little as Rs 599 for first year. Use the code “GETPRO”. Moneycontrol Pro offers you all the information you need for wealth creation including actionable investment ideas, independent research and insights & analysis For more information, check out the Moneycontrol website or mobile app.

courtsey By – https://www.moneycontrol.com/news/buzzing-stocks/bpcl-jumps-7reportsgovt-mulling-stake-sale_12981801.html

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