Financial Daily from THE HINDU group of publications
Thursday, Oct 28, 2004
Financial Daily from THE HINDU group of publications Thursday, Oct 28, 2004 |
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Markets
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Stock Markets Industry & Economy - Petroleum Refineries' stocks float on higher profit margin hopes Our Bureau
Mumbai , Oct. 27 WITH international oil prices remaining firm, stock prices of standalone refineries were in the limelight in today's trading. Brokers and analysts said with higher crude prices refining margins will also be higher for these companies. In today's trading, Chennai Petro gained 12.20 per cent at Rs 245.60 on the BSE. Other stocks on rise included Bongaigaon Refinery (up 8.12 per cent at Rs 97.20), Mangalore Refinery (up 4.54 per cent at Rs 46.05) and Kochi Refinery (up 4.02 per cent at Rs 200.60). Brokers said most of refinery companies' profit margins have increased quarter-on-quarter basis. They said initially there were concerns among the market players over the margins but now they feel that margins will keep on increasing with rising international oil prices. The proposal of BPCL to merge its subsidiary Kochi Refinery with itself is also bringing lot of interest among the market players. "Since other refinery companies are also subsidiaries of oil majors, there is possibility of merger of these companies also," said an analyst with a domestic broking firm. Chennai Petro and Bongaigaon Refinery are subsidiaries of Indian Oil Corporation and Mangalore Refinery is subsidiary of ONGC. Brokers said whenever the market looks at these refinery companies the possibility of merger is always thought of. "With Kochi Refinery merger with BPCL being proposed, other mergers are also possible," said a dealer with a domestic broking firm. Another reason for the interest in these stocks is on expectation of higher dividend in the current fiscal due to higher profitability. A broker said the Government has already hinted at higher payout by PSUs. Since large stakes in these companies are with the Government, higher payout cannot be ruled out.
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