www.rupeedesk.in
Stocks of state-owned oil marketing companies as well as private sector players such as
Reliance Industries Ltd are seen volatile in line with the broad market as the election
process ends with the last phase of voting on Monday. There are no major triggers in the
near term for Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd, and Hindustan Petroleum
Corp Ltd. The only positive is the Election Commission asking the government to
continue the diesel price hike.
However, the companies are unlikely to take a call on increasing price of the fuel anytime
soon and may announce a cumulative hike of one rupee by the end of this month, unless
the new government decides otherwise. The three companies had refrained from the
monthly 50 paise a litre hike in diesel price in April.
Also, the government may announce next week the amount of subsidy these companies
will be paid before they detail their Jan-Mar results. The finance ministry is likely to only
partially compensate oil marketing companies for revenue losses incurred on sale of
subsidised fuels in 2013-14 (Apr-Mar).
The oil ministry had sought 410 bln rupees as subsidy from the finance ministry for
2013-14, which includes around 170 bln rupees that was not compensated till December
end and 240 bln for Jan-Mar. The official indicated that the subsidy amount of 240 bln
rupees sought by companies for Jan-Mar is likely to be given.
That announcement could lead to momentary reactions in shares of these companies, but
the overbearing theme would be the exit poll from various media organisations that will
start trickling in after 1830 IST on Monday once polling ends.
The indications will set the mood for the market till Thursday and will be taken over by
actual trends emerging from the vote counting that will begin early Friday.
RIL stocks will move closely in sync with the market that is betting big on a National
Democratic Alliance government. If early trends indicate a lead for the NDA, Reliance
Industries shares would cross the 1,000-rupee mark for the first time since April 2011.
Stocks of state-owned oil marketing companies as well as private sector players such as
Reliance Industries Ltd are seen volatile in line with the broad market as the election
process ends with the last phase of voting on Monday. There are no major triggers in the
near term for Indian Oil Corp Ltd, Bharat Petroleum Corp Ltd, and Hindustan Petroleum
Corp Ltd. The only positive is the Election Commission asking the government to
continue the diesel price hike.
However, the companies are unlikely to take a call on increasing price of the fuel anytime
soon and may announce a cumulative hike of one rupee by the end of this month, unless
the new government decides otherwise. The three companies had refrained from the
monthly 50 paise a litre hike in diesel price in April.
Also, the government may announce next week the amount of subsidy these companies
will be paid before they detail their Jan-Mar results. The finance ministry is likely to only
partially compensate oil marketing companies for revenue losses incurred on sale of
subsidised fuels in 2013-14 (Apr-Mar).
The oil ministry had sought 410 bln rupees as subsidy from the finance ministry for
2013-14, which includes around 170 bln rupees that was not compensated till December
end and 240 bln for Jan-Mar. The official indicated that the subsidy amount of 240 bln
rupees sought by companies for Jan-Mar is likely to be given.
That announcement could lead to momentary reactions in shares of these companies, but
the overbearing theme would be the exit poll from various media organisations that will
start trickling in after 1830 IST on Monday once polling ends.
The indications will set the mood for the market till Thursday and will be taken over by
actual trends emerging from the vote counting that will begin early Friday.
RIL stocks will move closely in sync with the market that is betting big on a National
Democratic Alliance government. If early trends indicate a lead for the NDA, Reliance
Industries shares would cross the 1,000-rupee mark for the first time since April 2011.
