The Hindu Business Line : No follow-on offers in IOC, ONGC for now

The Government has ‘no immediate plans' to offload stake in public sector undertakings ONGC and Indian Oil Corporation Ltd (IOC) through follow-on-public offerings. This was said by the Petroleum Secretary, Mr S. Sundareshan, at the sidelines of an International Symposium on Fuels and Lubricants here on Wednesday.

The Secretary said, ‘‘There is no serious consideration (on FPOs of the two companies) at this juncture,'' adding that ‘‘this is not the correct market time anyway.''

The Government holds 74.14 per cent stake in ONGC and 78.92 per cent in IOC.

On the financial health of the public sector oil marketing companies (OMCs), he said: “The challenge before us is that the OMCs do not suffer under-recoveries.''

He said that maintaining the financial health of the OMCs, that currently incur a loss of Rs 190 crore a day on sale of petrol, diesel, domestic LPG, and PDS kerosene, was important to ensure supply lines do not run dry and investments are made for expansion. The OMCs incur under recoveries as they sell petroleum products below the market price.

‘‘There is a need for realistic pricing of petroleum products so that the companies do not suffer under-recoveries,'' he said.

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