HPCL failed to sustain its high of Rs 303.70 on Tuesday and came off to Rs 299.30, above its Monday's closing by a mere 0.15%.
The scrip of the oil refining PSU had also hit the day's low of Rs 298.40 earlier, thus staying in a range of Rs 5.30.
Yet, the scrip currently trades near its 52-week high (52-week closing high is Rs 306.35 of 1 January 2003). The stock has generated substantial interest from operators.
Recent news reports that the government is likely to invite preliminary bids for a 34% stake in the company by 10 February 2003 has proved very inviting for operators, considering that the refiner's divestment has been its biggest trigger in the past one year.
Marketmen feel another trigger for HPCL will be the reserve price that the government sets for divestment in HPCL. If the reserve price is about Rs 500-600 per share, the stock's fortunes will be boosted, they think.
The government recently gave a green signal for divestment of a 34% stake in HPCL by way of strategic sale. 34.01% will be sold to a strategic partner, 5% to the company's employees and the government will retain 12% equity. The government currently has a 51% stake in HPCL.
There has been some concern among marketmen, however, over the fact that workers of state-run petroleum companies are threatening a nationwide strike to block the sale of HPCL and BPCL. The threat came a day after the Centre cleared the sale of stakes in BPCL and HPCL.
For Q3 ended 31 December 2002, HPCL posted a gigantic 444% rise in net profit to Rs 330.62 crore (Rs 3.3 billion) compared to Rs 60.81 crore in the corresponding period of the previous year. Net sales jumped 28% to Rs 14,210.23 crore (Rs 142.1 billion) from Rs 11,1156.38 crore (Rs 1111.56 billion) in DQ 2001. Both net profit as well as net sales beat estimates of a capitalmarket.com poll of three oil analysts - a net profit of Rs 145 to Rs 158.6 crore (Rs 1.45 to Rs 1.58 billion) on net sales of Rs 12,155-12,550 crore (Rs 121.55-125.5 billion).
HPCL's board of directors also recommended an interim dividend of 20% (ie Rs 2 per share) for the financial year 2002-03. The company attributed the solid performance to buoyant international prices coupled with improved refining and marketing margins.
Growth was recorded in sales of almost all categories of products - LPG (9.5%), MS (8.9%), HSD retail (2.3%), AFT (6.2%), FO (6.1%), bitumen (24.4%), lubricants (27.6%), naphtha (4.5%) and LSHS (4.1%). Only kerosene (SKO) (4.3%) moved negatively.
HPCL has about 4,600 retail outlets and a 20% market share in retailing petroleum products
BSE Code: 500104