PSU OMCs edge higher as crude oil drops

HPCL (up 0.79% to Rs 287.95), Indian Oil Corporation (up 0.35% at Rs 270) and BPCL (up 0.33% to Rs 544.35) edged higher.

Meanwhile, the BSE Sensex was up 53.14 points, or 0.33% to 15,923.49.

HPCL had underperformed the market over the past one month till 12 December 2011, falling 8.47% compared with the Sensex's 7.69% decline. The scrip had also underperformed the market in past one quarter, declining 21.83% as against 3.83% fall in the Sensex.

Indian Oil Corporation had outperformed the market over the past one month till 12 December 2011, falling 4.37% compared with the Sensex's 7.69% decline. The scrip had, however, underperformed the market in past one quarter, declining 14.88% as against 3.83% fall in the Sensex.

BPCL had outperformed the market over the past one month till 12 December 2011, falling 2.87% compared with the Sensex's 7.69% decline. The scrip had, however, underperformed the market in past one quarter, declining 17.51% as against 3.83% fall in the Sensex.

Lower crude oil prices could reduce under-recoveries of state-run oil marketing companies (PSU OMCs) on domestic sale of diesel, LPG and kerosene at controlled prices.

Crude oil for January 2012 delivery lost $1.64 a barrel, or 1.65% to settle at $97.77 a barrel on the New York Mercantile Exchange on Monday, 12 December 2011.

However, weak rupee will negate the impact of lower crude oil prices for PSU OMCs as the crude oil that refineries process is either imported or priced on import-parity. The partially convertible rupee fell 1.53% to settle at 52.84/85 to the dollar on Monday, 12 December 2011, its biggest one-day loss since 21 November 2011.

Powered by Capital Market - Live News