Shares of oil marketing companies (OMCs) were in focus today amid reports that the Union Cabinet was likely to approve subsidies for Indian Oil Corporation Ltd (IOCL), Hindustan Petroleum Corporation Ltd (HPCL) and Bharat Petroleum Corporation Ltd (BPCL). The government is likely to clear Rs 22,000 crore to cover losses they have incurred on retail sales of petrol and diesel.
Buoyed by the development, shares of BPCL rose after three days of fall. They touched an intraday high of Rs 309.1, rising 3.07 per cent against the previous close of Rs 299.90 on BSE. BPCL stock is trading lower than the 5-day, 20-day, 50-day, 100-day and 200-day moving averages.
HPCL stock too gained after three days of fall. However, it is trading 1.99 per cent away from 52-week low of Rs 206.7. The stock gained 2.42 percent intraday to Rs 215.45 on BSE.
ALSO READ: Cabinet likely to approve Rs 22,000 cr subsidy package for Indian Oil, BPCL, HPCL
The stock of IOC too gained 2.8 per cent intraday at Rs 67.85 against the previous close of Rs 66 on BSE. The IOC stock is trading higher than 5 day moving averages but lower than 20-day, 50-day, 100-day and 200-day moving averages.
The move to provide subsidy is likely as OMCs have incurred heavy losses on the sale of petrol and diesel due to non-revision of prices for a record 137 days from November 4, 2021 to March 22, 2022. Earlier this year, Moody’s Investor Service in a report said that since November last year, state-owned refining and marketing companies together incurred a loss of about $2.25 billion (Rs 17,000 crore) in revenue on petrol and diesel.
Share Market Live News: Sensex rebounds over 350 points in volatile trade, Nifty50 eyes 17,100; FMCG, IT, auto stocks climb
Last month, BPCL chairman and managing director Arun Kumar Singh said that state-owned oil marketing companies did not raise prices for almost five months despite rise in international crude prices. He said international oil prices were highly volatile, rising or falling by $5-7 per barrel on a single day.