SENSEX NIFTY
Feb 13, 2013, 07.05 PM IST | Source: CNBC-TV18

Warning Bells! Diesel price hike likely on Feb 17-18: Kotak

Fuel yourself well as diesel price hike is in the offing once again. According to Sanjeev Prasad of Kotak Institutional Equities, the government is likely to increase small diesel price hike on February 17-18 as per the government's plan of raising diesel prices by small amount over a period of time.

Diesel price hike is in the offing once again. According to Sanjeev Prasad of Kotak Institutional Equities, the government will go ahead with its plan to raise diesel prices every month, and the second tranche of it may come on February 17-18. On January 17, oil firms had hiked diesel price by 45 paise.

Earlier, this month, Oil Minister M Veerappa Moily had announced that diesel prices will be hiked by 40-50 paise per litre every month till losses on the nation's most used fuel are completely wiped out.

The move is set to benfit companies like ONGC , points out Prasad. An important data point to take away from results is the recovery in domestic production that was declining for the last four quarters, he said in an interview to CNBC-TV18. "This is the first time after four quarters we have seen an improvement in production from the company's own field as far as crude is concerned."  ( ONGC Q3 net down 17.5% to Rs 5,563cr, but beats forecast )

Talking specifically about the market, Prasad feels that it is important for the Union Budget to send out positive signs to increase investments in India. He finds both global market sentiment and liquidity stable at the moment and sees foreign institutional investors (FIIs) focussing on select large cap stocks.

At the same time, he is worried that investment cycle is unlikely to pick up in next 18-24 months.

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