The stock of BPCL, which announced a solid dividend of Rs 58 per share, will go ex dividend on Sept 16.
It maybe recalled that earlier in May, while announcing the quarterly results for the fourth quarter ending March, 2021, the board approved a final dividend of Rs 58 per share, which includes a one-time special dividend of Rs 35 per equity share.
BPCL: On the road to privatization
BPCL is being privatized and the government is looking to sell its stake in the company. Fitch Ratings recently said it continues to treat the potential divestment of BPCL by the Indian government as an event risk.
"Bidders are conducting due diligence, but uncertainty over the bidder consortiums and process complexity, including valuation, may lead to potential delays. We believe the risks of further Covid-19 waves and global oil and gas companies' increased focus on energy transition lead to additional uncertainty over the timing and valuation of potentially large acquisitions in the sector," the ratings agency has said.
BPCL: Demand below pre-pandemic level
Fitch expects BPCL's marketing sales to improve to 43 million tonnes (MT) in FY22 from 41MT in FY21, still 6% below the FY20 level. This reflects the impact on India's petroleum product demand from the pandemic's second wave in 1QFY22 and the risks of further waves.
"We expect the demand fall in FY22 to be less severe than FY21 as business and societal behavior has adjusted, supporting activity, and the vaccination programme may prevent a severe recurrence in infections," the ratings agency has said.
Large Capex for BPCL
Fitch expects annual capex of Rs 100 billion over FY22-FY25, with the majority spent on the refining, petrochemical and marketing segments, and a smaller share on the city-gas distribution and upstream segments.
"We expect BPCL to stabilise production at its recently commissioned petrochemical plant at Kochi Refinery in 2HFY22 and add more than 2,000 fuel retail outlets in FY22. Large new projects may not be started until the divestment is complete, given the uncertainty over the strategy of a potential new owner," the ratings agency has said.
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