While BPCL gained 13 per cent, Hindustan Aeronautics rose 12 per cent. Bharat Dynamics, Chennai Petroleum, HPCL, Hindustan Copper and NBCC among others gained between 5 per cent and 10 per cent.
According to analysts, the government will try to get higher value in BPCL by maintaining better financial health through higher net marketing margins on petrol & diesel, which would benefit all oil marketing companies (OMCs).
“Higher net marketing margins would be positive for all OMCs and thus benefiting not only BPCL, but also HPCL and India Oil Corporation,” said Arjun Yash Mahajan, head – institutional business, Reliance Securities.
Global energy majors such as Saudi Arabia’s Aramco, Russia’s Rosneft, Exxon Mobil and Abu Dhabi National Oil Co are in the race to pick a 51 per cent stake in BPCL, according to a report by ETNow. The government recently extended the date for bids for BPCL stake to July 31.
ETNow said most bids are likely to come around Rs 1.2 lakh crore against the current market capitalisation of Rs 96,000 crore. Apart from strategic divestment, better valuation and liquidity also drove the rally in PSU stocks, said analysts.
“There is some bit of strategic divestment which along with liquidity and low valuation is fuelling the PSU rally,” said Gurmeet Chadha, co-founder, Complete Circle Consultants.
HPCL, Ircon International, BEML, ONGC, Indian Oil Corporation and NMDC are currently trading near to their book value or below the book.