The shares of a Maharatna PSU company which is into the refining of crude oil business and petroleum products marketing went up 3 percent in intraday trade after announcing a JV with Oil India.
Share price movement
In Monday’s trading session, the shares of Bharat Petroleum Corporation Limited went up 3 percent in intraday trade and touched a high of Rs.315.30 per share, from its previous close of Rs.305.95 apiece. The share has retreated since then and is trading at Rs.310.20 apiece, which is around 1.4 percent higher than the closing price.
Joint Venture announcement
Bharat Petroleum Corporation Limited is entering into a joint venture agreement with another Maharatna PSU Oil India Limited. This JV is for the purpose of developing a City Gas Distribution (CGD) project in Arunachal Pradesh. They are planning to do distribution, supply, and marketing of compressed, piped, liquified natural gases and other allied retail businesses.
JV rationale, shareholding, and terms
BPCL can benefit from this JV due to exposure to the state of Arunachal Pradesh to develop CGD Network from Oil India, which has already a strong presence and experience in hydrocarbon operation in the Northeast Area region.
The proposed JVC will be a private limited company with a share of 50 percent each to BPCL and Oil India. The authorized share capital of the JVC to be Rs. 125 Crores which consists of 125,00,0000 shares of Rs. 10 apiece. The initial issued, subscribed, and paid-up capital of the JVC to be Rs. 5 Crores.
There is a chance that the JV might provide a stake of up to 10 percent to the Government or Nominees of Arunachal Pradesh if they are willing to participate. In such case, the BPCL & Oil India shall be reduced in equal proportion.
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Financial Performance
Bharat Petroleum Corporation Limited reported its financial results and in Q2FY25 revenue from operations was down by 0.25 percent year-on-year from Rs. 1,03,044 crore in Q2FY24 to Rs.1,02,785 crore in Q2FY25. Additionally, during the same period Profit After Tax (PAT) was Rs.8,244 crore in Q2FY24 to Rs. 2,297 crore in Q2FY25.
Company Profile
Bharat Petroleum Corporation Limited (BPCL) is a leading Indian oil and gas company headquartered in Mumbai. It operates three refineries and a vast network of over 18,000 fuel stations, providing petrol, diesel, LPG, and aviation fuel. BPCL focuses on sustainable energy solutions and expanding its petrochemical capabilities.
Written by – Santhosh S
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