Oil and gas shares have a good day

The strong response to the Oil and Natural Gas Corporation's (ONGC) public offer lifted the share prices of other oil and gas scrips on Friday.

The price of ONGC looked up 5.55 per cent to close at Rs 802.25, after the government's public offer to sell a 10 per cent share in the company was oversubscribed by over two times.

The government is selling around 143 million ONGC shares, which will raise at least $2.15 billion at a bottom price band of Rs 680-750. From a low of Rs 665.30 on February 25, the ONGC stock has risen 20.58 per cent.

According to market buzz, billionaire stock market investor Warren Buffet is responsible for a huge part of the subscription to the ONGC issue. However, dealers said this could be just a rumour "� spread with a view to pep up the counter.

Other refinery and gas stocks also surged during the day. Hindustan Petroleum Corporation looked up 5.87 per cent to close at Rs 498.80 on fund-based buying.

Indian Oil Corporation surged 4.59 per cent to Rs 496.65 on fresh buying on reports that the company plans to enter the gas business in a big way.

Meanwhile, the Bharat Petroleum Corporation surged 4.17 per cent to Rs 501.15 on all-around buying interest in refinery stocks.

Reliance Industries, the biggest private sector refinery, rose 2.05 per cent to Rs 586.30. Dealers at a local brokerage house said the growth prospects of the oil and gas sector and the decent pricing of the ONGC issue have boosted institutional response.

Krishnamurthy Vijayan, president and chief executive officer, J M Mutual Fund said, "With the ONGC issue getting oversubscribed on the first day, I expect the trend in oil stocks to be extremely positive which had witnessed some profit booking prior to public offers."

Ambreesh Baliga, vice-president, private client group at Karvy Stock Broking, said: "Oil stocks were in the limelight because of good response to the ONGC issue."

Buying interest was witnessed in other secondline refinery counters too. MRPL jumped up 6.72 per cent to Rs 58, Bongaigaon Refinery added 4.17 per cent to Rs 501.15 and Chennai Petroleum rallied 3.33 per cent to Rs 102.50.

Also, GAIL India looked up 3.30 per cent to Rs 214.70 as large institutions had raised their bids to around Rs 195, compared with a floor price of Rs 185.