Shares of Bharat Petroleum Corporation Ltd. (BPCL) fell over 3 percent on Thursday after the government announced a strategic sale of its 53.29 percent stake in the refiner after taking out Numaligarh refinery from its portfolio.
In the opening trade, BPCL shares hit a fresh 52-week high of Rs 549.70 per share on the BSE, rising 0.9 percent from its previous close. However, the stock soon eased gains and fell as much as 3.17 percent to Rs 527.35 per share intraday.
At 10 AM, BPCL's stock price was trading 2.24 percent lower at Rs 532.25 per share, while the Sensex was up 0.02 percent at 40,660.34.
Union Finance minister Nirmala Sitharaman said that the cabinet approved the divestment of the Indian government's 53.29 percent stake in BPCL to a strategic investor along with management control.
However, the Numaligarh refinery (of which BPCL owns 61.7 percent and forms 10 percent of its NAV, 14 percent of F21e earnings) and has special excise benefits would be sold to an SOE entity, she added.
BPCL's stake sale is part of the government's disinvestment target of Rs 1.05 lakh crore, which also includes divestment of other state-owned companies such as Shipping Corp of India (SCI), THDC India Ltd and North Eastern Electric Power Corp Ltd, and a 30 percent stake sale in Container Corp of India.
Privatisation of BPCL will not just shake up fuel retailing sector long dominated by state-owned firms but also help meet at least a third of the government's Rs 1.05 lakh crore disinvestment target.