The process of receiving initial bids for privatisation of state-run oil marketing company Bharat Petroleum Corp Ltd (BPCL) will end today and analysts say big energy companies such as UK's BP Plc, Total of France and Saudi Aramco are unlikely to bid for the state-owned company.
The asking price of close to $10 billion by the government for selling its entire 52.98 per cent stake may keep the energy giants away from bidding for a majority stake in the second largest oil refinery and marketing company in India. This comes at a time when the world is moving away from conventional fuel.
The government has extended the date of putting in the preliminary expression of interest (EoI) on four occasions, with the current deadline now being shifted to November 16. As per Department of Investment and Public Asset Management (DIPAM) Secretary Tuhin Kanta Pandey, the deadline won't be extended anymore.
Billionaire businessman Mukesh Ambani-led Reliance Industries Ltd (RIL), that operates the world's largest oil refining complex at Jamnagar in Gujarat, intends to expand into the retail business and has strong ambitions to sell fuel. However, the oil conglomerate has so far remained tight-lipped on its intentions regarding BPCL.
A few days back, RIL also hired former BPCL chairman Sarthak Behuria and former IOCL chairman Sanjeev Singh. Reports say the two could be connected to RIL's plan to bid for BPCL. However, there's no official confirmation from the company so far.
If at all that happens, Reliance will be able to combine its Jamnagar refinery with BPCL' Mumbai, Kochi and Bina units and merge more than 1406 of its fuel stations with BPCL's 17,138 petrol pumps.
The stake sale will give buyer access to 15.3% of India's oil refining capacity from BPCL's three refineries - Mumbai, Kochi in Kerala and Bina in Madhya Pradesh, and a nationwide readymade fuel retailing network that controls 22% market share in the world's fastest-growing energy market.
The government is keen on closing the stake sale before March 31, 2021, for meeting the record Rs 2.1 lakh crore divestment target set by Finance Minister Nirmala Sitharaman for FY21.
Copyright©2021 Living Media India Limited. For reprint rights: Syndications Today