IOC up on ONGC buyback proposal

DALAL STREET SPIKES

The Indian Oil Corporation (IOC) stock was in the limelight on Friday, gaining nearly two per cent on news that ONGC proposes to buy back its 9.6 per cent stake held by the oil refiner.

Analysts said IOC would make a massive one-time gain on sale of shares of ONGC, as it currently holds around 13.7 crore shares.

The counter in Friday's trading witnessed an impressive volume of more than 1.6 lakh shares on the BSE. IOC holds a 9.6 per cent stake, and had forked out Rs 1,617 crore for acquiring the same.

However, at ONGC's current scrip price of Rs 800, IOC's 9.6 per cent holding is worth Rs 10,900 crore, analysts added.

As per reports, the government on Wednesday had approved ONGC's proposal to buy back IOC's 9.6 per cent stake in ONGC.

Another trigger for the scrip's two-day surge is expectation of a hike in price of transportation fuels such as diesel and petrol by the three oil marketing companies "" IOC, HPCL and BPCL. ONGC, too, gained 1.6 per cent on the back of strong buying support to close at Rs 805.90.