HPCL plans to take IPO route to raise capital

Country's two big public sector refiners, Bharat Petroleum Corp Ltd (BPCL) and Hindustan Petroleum Corp Ltd (HPCL), are mulling IPOs for their upcoming refineries for a long time. But while BPCL is yet to take a call on the timing of IPO for its Bina refinery in Madhya Pradesh, HPCL might hit the capital market in a year from now.

The Guru Gobind Singh Refineries (GGSRL), being set up at Bathinda by a HPCL-Mittal Energy JV, is finally on track and with the stock market looking up, there are plans to go public in the next financial year.

HPCL's Bathinda refinery is being set up for a total cost of Rs 18,900 crore and is expected to be complete by March 2011. While the recession has helped the company in bringing down the cost of the project by Rs 300 crore, HPCL's demand for fiscal benefits from the state government still remain elusive. The Bathinda refinery has had its share of controversies with oil major BP exiting the project even before the construction began. So, a timely completion is the only hope for HPCL which has always struggled with new projects.