DSIJ Mindshare

On merger: Oil Marketing companies on fire

Indian oil marketing companies are scripting their new high this season, already gaining from the depleting international oil prices. The shares of the major oil marketing companies are at their record high. Shares of the companies like ONGC, IOC, HPCL, BPCL, GAIL, MRPL, Chennai Petroleum, Numaligarh Refinery and Oil India have all gained. There are speculations that the government is planning to merge 13 PSU oil firms.

As on July 25, 2016, at 2.40 pm the shares of ONGC are trading at Rs 226.10, up by 1.26 per cent; IOC is trading at Rs 536.15, up by 2.82 per cent; HPCL is trading at Rs 1220, up by 4.36 per cent; BPCL is trading at Rs 594.05, up by 1.90 per cent; and MRPL is up by 10.17 per cent and is trading at Rs 88.80.

On the other hand, Union Minister of State (independent charge) for Petroleum and Natural Gas Dharmendra Pradhan, has said that Chennai Petroleum may be merged with IOC. IOC already owns 51.9 percent while National Iranian Oil Company (NIOL) owns 15.4 percent in Chennai Petroleum.

The talk of the town is the merger between Chennai Petroleum and IOC. Chennai Petroleum Corporation as at 2.52 pm is trading at Rs 266.95, up by 5.10 per cent; and the shares of IOC are trading at Rs 536.60, up by 2.91 per cent.
It could be interesting to watch what kind of synergies are exchanged after the merger, but one thing is for sure, if the merger happens it will certainly create one strong single entity.

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