Meanwhile, the BSE Sensex was down 25.84 points or 0.13% at 19,640.75
ONGC rose 2.06% to Rs 298 on volume of 6.74 lakh shares on BSE. Oil India gained 3.09% to Rs 490.60 on volume of 73,164 shares on BSE.
ONGC had outperformed the market over the past one month till 9 January 2013, rising 9.12% compared with the Sensex's 1.25% rise. The scrip, however, underperformed the market in past one quarter, rising 3.99% as against Sensex's 4.65% rise.
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Oil India had outperformed the market over the past one month till 9 January 2013, rising 5.46% compared with the Sensex's 1.25% rise. The scrip, however, underperformed the market in past one quarter, falling 2.64% as against Sensex's 4.65% rise.
As per reports, the government is trying to build consensus for raising diesel, cooking gas and kerosene prices to reduce subsidy bill and manage deficit. A hike in fuel price augurs well for ONGC and Oil India as they share part of the under-recoveries of state-run oil refining-cum-marketing firms arising from the government-imposed price caps on three key fuels including diesel, LPG for domestic use and kerosene sold through the public distribution system.
Reports indicated that the government has formally started the consultation process for raising diesel and cooking gas prices - the latter with an increased annual cap of nine subsidised refills - in line with the recommendations of a finance ministry panel.
The committee under former bureaucrat Vijay Kelkar, tasked to suggest a roadmap for cutting fiscal deficit, has suggested raising diesel price periodically to align it with market rate by the beginning of 2014-15 fiscal. The panel also suggested raising cooking gas and kerosene prices, reports added.
Meanwhile, the Ministry of Petroleum and Natural Gas on 1 January 2013 said that the under-recovery on High Speed Diesel (HSD) applicable for the first fortnight of January 2013, effective 1 January 2013, has decreased to Rs 9.03 per litre from Rs 9.28 per litre for the 2nd fortnight of December 2012.
In case of Domestic LPG, the under-recovery for January 2013 remains unchanged at Rs 490.50 cylinder. The Under-recovery on PDS Kerosene, too, has remained at same level of Rs 30.64 per litre for January 2013, the ministry said. PSU OMCs are currently (effective 1 January 2013) incurring daily under-recovery of about Rs 389 crore on the sale of Diesel, PDS Kerosene and Domestic LPG.
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