The Hindu Business Line : Oil India IPO likely

The Centre is considering unveiling an initial public offering (IPO) for the Rs 10,000-crore Oil India Ltd. According to sources, the Union Petroleum and Natural Gas Ministry is currently preparing a draft proposal in this regard for submission before the Cabinet committee, shortly.

The sources said the Ministry had also initiated dialogue with the Left in this regard.

When contacted the Union Minister of Petroleum and Natural Gas, Mr Murli Deora, told Business Line: "The proposal for an IPO is under consideration".

He, however, added that no decision had yet been taken on the issue.

Sources, however, said the Ministry had underlined the need for raising finances by issue of fresh equity shares - to the extent of 10 per cent of the expanded capital base - to finance OIL's plans to enhance exploration and production activities in India and the abroad.

While the exact issue size would depend on the premium charged, informed sources expect the IPO to raise anywhere between Rs 1,800 crore and Rs 2,000 crore.

"Discussions are currently on finer details like employees quota in the IPO," said a source close to the development.

OIL has registered a net profit in excess of Rs 1,600 crore during the last fiscal on a turnover of Rs 10,000 crore and a reserve of Rs 4,000 crore.

The company produces roughly three million tonne of crude oil from its assets in North Eastern region and has a paid up capital of Rs 214 crore.

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