HPCL Approves Rs 2,500 Crore Share Buyback
HPCL will buyback up to 10 crore shares from the open market.
The board of Hindustan Petroleum Corporation Ltd. on Wednesday approved a Rs 2,500 crore share buyback plan as the company management believes the share price is lower than the value it deserves.
HPCL will buyback up to 10 crore shares from the open market, from persons other than its promoter Oil and Natural Gas Corporation Ltd., for no more than Rs 250 apiece, it said in a stock exchange filing.
The company plans to buyback up to 6.56% of the total shares.
HPCL, a subsidiary of state-owned Oil and Natural Gas Corporation Ltd., has no immediate history of a share buyback.
Post buyback, ONGC’s shareholding in the firm will rise to 54.70% from the current 51.11%. Public shareholding will fall to 45.30% from 48.89%, the company said.
HPCL shares settled at Rs 186.75 apiece on BSE, up 0.54% over the previous close. The shares are trading at about a third of the Rs 473.97 per share that ONGC paid in January 2018 to acquire the government's 51.11% share in HPCL.
HPCL is the nation's third-biggest oil retailer after Indian Oil Corporation Ltd. and Bharat Petroleum Corporation Ltd. It owns two refineries - a 7.5 million tonne unit in Mumbai and another 8.3 million tonne facility at Visakhapatnam in Andhra Pradesh. It also owns half of the 11.3 million tonne Bathinda refinery in Punjab and is a 16.95% owner of the 15 million tonnes a year Mangalore Refinery. It owns and operates 17,171 of 71,843 petrol pumps in the country.