BPCL shares jump 8%, extend gains into 3rd session in a row

Extending their winning run into the third consecutive session, shares of Bharat Petroleum Corporation (BPCL) jumped 7.66 percent to Rs Rs 531.90 on BSE on October 3.

The stock has gained traction after reports emerged that the government was planning to sell its stake in the company.

The government holds 53.29 percent equity in BPCL, which translates to about Rs 57,000 crore.

“BPCL was a star performer in September series and a lot of long was built on it after the merger news, which has now been approved by the cabinet. The level of Rs 500 has been achieved, and analysts expect the stock to reach the target of Rs 525 in the near-term. With its divestment news around the corner, the market would be watching for what price does the promoter get during its divestment and also how the new promoter takes up the company,” said Amit Gupta, Co-Founder and CEO, TradingBells.

Global financial firm Citi has maintained a buy rating on BPCL, putting the company on the top of the pecking order of oil marketing companies.
It said successful privatisation should benefit valuations of the marketing business for HPCL and IOC.

Citi, however, said that the upside in the event of proper privatisation could still be material and the extent could be contingent on the quantum of stake on offer.

Citi was waiting to hear from the government about the divestment plan.
Shares of BPCL were trading 5.25 percent higher at Rs 520 at 1310 hours.

Source : http://tiny.cc/udfvdz

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