ONGC Increases Stake In Petrochemical Subsidiary By Investing Rs 10,501 Crore
The move was made to facilitate the goal for further vertical integration of ONGC to downstream petrochemicals.
Oil & Natural Gas Corp. increased its stake in ONGC Petro additions Ltd. from 94.57% to 95.69% by making an investment of Rs 10,501 crore in the subsidiary, according to an exchange filing on Tuesday.
ONGC has been allotted 490.6 crore shares of OPaL having a face value of Rs 10 each by way of subscription of shares on a right basis. The public sector undertaking made the investment after approvals from the Union government and the board of directors, it said.
The move was made to facilitate the goal for further vertical integration of ONGC to downstream petrochemicals, according to the company.
OPaL was incorporated on Nov. 15, 2006, and has a plant in the Dahej special economic zone in Gujarat's Bharuch district. The subsidiary has design capacity of 1.1 million tonnes per annum in terms of poly-ethylene capacity ratings.
OPaL operates a large petrochemical complex covering 5 square kilometres, with a capacity to produce 1.4 MT of polymers and 5 lakh tonnes of chemicals annually.
In November, ONGC Videsh Ltd., a wholly owned subsidiary of ONGC, acquired an additional stake in an offshore Azerbaijan oilfield from Norway's state-owned Equinor for $60 million.
The state-run crude oil producer's consolidated net profit rose 0.69% sequentially to Rs 9,878.4 crore in the quarter ended September, compared to Rs 9,810 crore in the previous quarter.
Shares of ONGC closed 1.86% higher at Rs 262.35 apiece on the National Stock Exchange, compared to a 0.75% advance in the benchmark Nifty. The share price has risen 27.94% on a year-to-date basis.
Out of the 30 analysts tracking the company, 20 have a 'buy' rating on the stock, five suggest 'hold' and as many recommend 'sell', according to Bloomberg data. The average of 12-month analysts' price targets implies a potential upside of 20.6%.
