INSUBCONTINENT EXCLUSIVE:
Mumbai | New Delhi: Oil majors Reliance Industries, IndianOil, HPCL and BPCL are on a debt-raising spree and have raised Rs 78,000 crore in
short-term debt using commercial papers (CPs) in nine weeks to pay for costly crude purchased before oil prices crashed, while sales revenue
has fallen drastically during the lockdown.
State-owned firms are severely hit as they are bearing the additional burden of welfare schemes
of the government and have not yet been reimbursed for subsidies on kerosene and cooking gas.
The four firms sold commercial papers (CPs)
worth around Rs 78,045 crore between February and now, which is about 32% higher than the sum raised in the corresponding period last year,
data compiled by financial services company JM Financial show.
Indian Oil raised the highest sum of Rs 35,395 crore followed by Reliance
BPCL and HPCL sold CPs worth Rs 7,700 crore and Rs 6,900 respectively
Interest rates vary between 4.65% and 8% for papers issued after the latest rate cut by the RBI compared with 7-10% before the central bank
sales have sharply fallen and prices too have come down
March, which had just one week of lockdown, diesel sales for the entire month fell by a quarter
Jet fuel sales fell a third and petrol by 15%
scrambling for cash to fund multiple government-imposed obligations
IndianOil, HPCL and BPCL are in the process of transferring a combined Rs 6,000 crore in April to eight crore Ujjwala cooking gas customers
as advance payments for their free refills the government has promised them.
A similar amount will be transferred in May as well as June as
three free refills have been promised
cooking gas and kerosene subsidy for the year 2019-20 to state oil companies, according to sources
State oil companies together contributed Rs 1,000 crore to PM-CARES fund to fight the Coronavirus pandemic.
On top of this, recent dividend
Financial.
BPCL recently received A1+ rating, the highest grade for CPs, for its planned CP of Rs 13,500 crore from rating company Crisil
