OMC stocks BPCL, GAIL, IOC rise upto 2% on Rs 15,000 crore capital support plan

In pre-Budget surveys, the power and green energy industry had expressed the need for the government to shift focus to green hydrogen.

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26 Aug, 2025 12:21

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Shares of oil marketing companies (OMCs) like Indian Oil Corporation (IOC), BPCL, GAIL, Oil India, and Hindustan Petroleum surged up to 2 percent on February 1 after the government announced capital support of Rs 15,000 crore for FY25, as widely expected by market participants.

In the last Budget, the finance minister had announced Rs 30,000 crore equity infusion into the oil marketing companies (OMCs), but the allocation was not implemented in FY24. While the equity infusion in IOC and BPCL was planned through rights issues, capital infusion into HPCL was to be done via its parent ONGC.

The Street penciled the fact that the government would reduce their capital infusion estimates for OMCs in FY25 as these companies reported strong profits in the first half of fiscal year 2023. Moreover, stable crude prices also helped these firms to offset losses incurred in the corresponding period of the previous fiscal.

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The industry had been keenly awaiting reforms, particularly those to promote city gas distribution (CGD) and to bolster natural gas consumption. They were hoping for a reduction in excise duty on compressed natural gas (CNG) and CNG vehicles, and removing customs duty on liquified natural gas (LNG). But none of these were announced.

In pre-Budget surveys, the power and green energy industry had expressed the need for the government to shift focus to green hydrogen since, over the years, it has supported solar and wind, leading to significant expansion in their installed and manufacturing capacities.

The industry also expected the central government to coordinate with the state governments and bring about policy initiatives such as reduction in VAT.

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