• BPCL holds 12.5 percent share in Petronet LNG and a 22.5 percent stake in IGL and is a co-promoter in both the companies

• BPCL Director (Finance) N Vijayagopal said that the company has planned a capex of over Rs 12,000 crore for FY22

New Delhi: Bharat Petroleum Corporation Ltd (BPCL) has no intention to pare its stake in Indraprastha Gas Ltd (IGL) or Petronet LNG Ltd (PLL), said Director (Finance) N Vijayagopal on Thursday. The top BPCL official told the media during a virtual interaction that doing so would lead to value erosion for BPCL, and it is something that neither the management nor the government wants in the run-up to its disinvestment. BPCL holds 12.5 percent share in Petronet LNG and a 22.5 percent stake in IGL and is a co-promoter in both the companies. 

Responding to questions on a media report that claimed that BPCL may sell part of its stake in IGL and Petronet LNG to shed its promoter status to obviate the need for the new owner to make open offers, Vijayagopal said, "BPCL has no intention to pare its stake in either PLL or IGL. There would be a need for an open offer in line with Securities and Exchange Board of India regulations. The government of India and BPCL are aligned to ensure that does not happen because that is value destruction for BPCL." 

BPCL has planned capex of Rs 12,000 cr for FY22: Director Finance

Commenting on the oil marketing company's (OMC) capex plans, Vijayagopal said that BPCL has planned a capex of Rs 12,000 crore for FY22. "BPCL has planned Rs 12,000 crore capex for FY22 on essentially three major areas — refining, petrochemicals and marketing. There is no embargo on projects as such in FY22. What we are going to do is that we won't take up any new major projects, like Rasayani." BPCL had spent nearly Rs 11,000 crore on capex in FY21.

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The backdrop

The government is in the process of disinvesting its 52.98 percent stake in BPCL and has declared its intention to complete the process in FY22. On April 10, the government opened BPCL's data room for access to prospective bidders. Three entities — Vedanta, private equity firms Apollo Global and I Squared Capital's arm Think Gas — have thrown their hats in the ring to acquire the government's stake and management control in BPCL.

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