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Stocks of state-owned oil marketing companies are seen opening positive next week after they announced a hike in petrol and diesel prices after market hours yesterday but the trend for rest of the week will be determined by the rupee-dollar movement. The three companies--Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd, and Hindustan Petroleum Corp Ltd--raised petrol price by 75 paise per ltr and diesel prices by 50 paise per litre, contrary to reports suggesting that the companies will not make the move following the Congress party's resounding defeat in the recent state assembly elections. Stocks of the three companies are expected to open with gains on Monday. However, the Indian currency has come under renewed pressure and fell below the 62-a-dollar mark this week. It hit a five-week low of 62.5450 during the day. Concerns still linger for these companies as that they are still losing 9.24 rupees per litre on sale of subsidised diesel.
There is continued volatility in the international oil prices because of geopolitical and economic developments around the globe, Indian Oil said in a release. Further hardening of crude prices or weakening of the rupee could weigh on these stocks next week. On the other hand, Reliance Industries stocks may stage a recovery next week after they closed yesterday at the lowest level in two weeks. Investors hose to ignore news that the company would add 1 mscmd of gas to output from the KG-D6 block. The company is likely to put to production a new well MA-8 in around a month. However, weak refining environment has added to investor concerns as the business accounts for almost 80% of the company's revenues. Most market participants though expect the company's stocks to recover from these levels. In a note yesterday, the refining environment has started improving and reiterated its outperforming rating on the stock with a price target of 1,044 rupees.
Stocks of state-owned oil marketing companies are seen opening positive next week after they announced a hike in petrol and diesel prices after market hours yesterday but the trend for rest of the week will be determined by the rupee-dollar movement. The three companies--Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd, and Hindustan Petroleum Corp Ltd--raised petrol price by 75 paise per ltr and diesel prices by 50 paise per litre, contrary to reports suggesting that the companies will not make the move following the Congress party's resounding defeat in the recent state assembly elections. Stocks of the three companies are expected to open with gains on Monday. However, the Indian currency has come under renewed pressure and fell below the 62-a-dollar mark this week. It hit a five-week low of 62.5450 during the day. Concerns still linger for these companies as that they are still losing 9.24 rupees per litre on sale of subsidised diesel.
There is continued volatility in the international oil prices because of geopolitical and economic developments around the globe, Indian Oil said in a release. Further hardening of crude prices or weakening of the rupee could weigh on these stocks next week. On the other hand, Reliance Industries stocks may stage a recovery next week after they closed yesterday at the lowest level in two weeks. Investors hose to ignore news that the company would add 1 mscmd of gas to output from the KG-D6 block. The company is likely to put to production a new well MA-8 in around a month. However, weak refining environment has added to investor concerns as the business accounts for almost 80% of the company's revenues. Most market participants though expect the company's stocks to recover from these levels. In a note yesterday, the refining environment has started improving and reiterated its outperforming rating on the stock with a price target of 1,044 rupees.
