Shares of three PSU OMCs rose 0.69% to 1.34% at 15:27 IST on BSE after raising diesel prices by 50 paise per litre from Sunday, 1 December 2013.
BPCL (up 1.34% at Rs 345), HPCL (up 0.77% at Rs 217) and Indian Oil Corporation (up 0.69% at Rs 203.10), edged higher.
Meanwhile, the S&P BSE Sensex was up 103.15 points or 0.5% at 20,895.08.
BPCL had underperformed the market over the past one month till 29 November 2013, sliding 3.1% compared with the Sensex's 0.65% fall. The scrip had, however, outperformed the market in past one quarter, jumping 26.07% as against Sensex's 12.99% rise.
HPCL had outperformed the market over the past one month till 29 November 2013, surging 8.96% compared with the Sensex's 0.65% fall. The scrip had also outperformed the market in past one quarter, jumping 31.83% as against Sensex's 12.99% rise.
Indian Oil Corporation (IOC) had outperformed the market over the past one month till 29 November 2013, rising 1.54% compared with the Sensex's 0.65% fall. The scrip had, however, underperformed the market in past one quarter, sliding 3.75% as against Sensex's 12.99% rise.
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The price increase excludes local sales tax or VAT. The price of diesel in Delhi will be hiked by 57 paise, including tax, to Rs 53.67 per litre, while it will cost Rs. 60.70 a litre in Mumbai. PSU OMCs suffer under recoveries on domestic sale of diesel, LPG and kerosene at controlled prices. In January 2013, the government allowed PSU OMCs to raise diesel prices in small measures at regular intervals while completely deregulating diesel prices sold to institutional or bulk buyers. The government has already freed pricing of petrol.
The Reserve Bank of India (RBI) today, 2 December 2013, said that beginning last week, the PSU OMCs have started accessing the foreign exchange (FX) market for their entire daily dollar demand. Going forward, the PSU OMCs have been advised to smoothen their daily dollar demand so that the upcoming bunched up demands on any particular day is covered in advance in the forward forex market or covered on days with low demand, the RBI said in a statement. Apart from covering in the forward markets, the PSU OMCs have also been advised to utilize the revolving lines of credit made available by banks with the specific objective of tiding over humps in dollar demands, the RBI said. The central bank also said that it will consider opening the swap window to PSU OMCs on the rare days when there is a pronounced spurt in dollar demand in the FX market.
Given the backdrop of broad stability returning to the forex market, on the basis of an ongoing review of the demand conditions in the market, PSU OMCs have been allowed to source dollars even beyond their normal daily requirements, the RBI said. This process has already been put in place last week and it is expected that the excess demand of the PSU OMCs will be funneled to meet their swap (second leg) commitments over a period of time, the central bank said. As indicated earlier, the RBI is closely monitoring the market and will continue to keep all options open regarding settlement of PSU OMC swaps, including rupee settlement, depending upon the evolving flow dynamics in the market, the RBI said.
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