The board of Bharat Petroleum Corp. approved the sale of its 61.25% stake in the Assam-based Numaligarh Refinery Ltd. for Rs 9,876 crore ahead of the divestment of the state-run refiner-retailer.
The proposal includes sale of 45.36 crore shares (Rs 10 each) of Numaligarh Refinery to a consortium of Oil India Ltd. and Engineers India Ltd. (48% stake), and to the Government of Assam (13.65%). The proposal is subject to approval from BPCL shareholders.
The stake sale is a step towards the divestment of BPCL in which the government plans to cede control by selling its entire 52.98%. If successful, the sale would help it meet its disinvestment target of Rs 1.75 lakh crore for 2021-22.
The consolidated total income and net worth of Numaligarh Refinery for the financial year 2019-20 was Rs 14,244 crore and Rs 5,292 crore respectively—4.29% and 14.18% of the consolidated total income and net worth of BPCL.
NRL is trebling capacity to 9 million tonnes and the performance of the company has improved after the excise duty hike in May last year as it gets exemption from the levy for being located in Northeast India, N Vijayagopal, director-finance at BPCL, told BloombergQuint in an interview.
“Unlike other refineries, NRL’s profitability will be considerably benefitted mainly by the excise duty benefits, plant configuration and we expect fairly good valuations,” he had said.