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HPCL, BPCL divestment decision in 10 days

The government will decide in seven to 10 days the mode to be followed in privatising two of the nation's largest oil refiners and distributors, divestment secretary Pradip Baijal said on Thursday.

He said the Cabinet will decide whether to first make a public offer of shares, followed by a strategic stake sale, or to just sell major stakes to strategic partners.

"If it's decided to go immediately for a stake sale, there will be no public share sale as it will be left to the strategic partner if and how to raise additional money," Baijal told reporters after addressing an HSBC-organised seminar in Mumbai on privatisation.

The two state-run companies are Bharat Petroleum Corporation and Hindustan Petroleum Corporation.

BPCL and HPCL are two of the four refiners which dominate the Indian oil products market. The two companies each hold market shares of about 20 per cent of the $15 billion domestic retail oil market.

On April 1, state-run companies lost their exclusive rights to retail petrol and diesel in India. The government also began allowing retailers to sell products at market rates instead of at government-determined prices.

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