Oct 3, 2002|
Economy: Its politics,…
When we ran a poll on whether government will divest BPCL and HPCL recently, 53% of the respondents said the disinvestment will happen within a year, 27% opined that it will happen post 2004 elections and 20% said that it will not happen at all.
Perhaps the gut feel of the majority was that the Prime Minister (PM), who has been one of the most vocal backers of disinvestment, would see it through. And sure enough, the PM yesterday made his stand clear on the issue and came down heavily on the opponents of divestment. Hearing the news, both BPCL and HPCL stock prices should have shot through the roof today, but both are up just marginally.
The price movement suggests that though the bourses have heard what the PM has said, they are not too convinced whether the PM can push divestment this time around. Till now, whenever Mr. Vajpayee has been caught in a corner, he has flashed his ‘resignation’ to get his way. However, with the elevation of Mr. Advani as Deputy PM, NDA constituents now see a new power centre. The PM’s detractors too, have taken this as an opportunity to run him down.
Unfortunately, in all this political maneuvering, the ministry that really performed under Mr. Shourie has had to bear the brunt. While Mr. Vajpayee’s tacit backing of disinvestment should have cleared all doubts, the market movement of the oil PSUs suggests otherwise. This is because the markets were also tuned into what the BJP ideologue was saying. With many of the top ministers opposing disinvestment the markets need more than the PM’s statement to feel comfortable.
The answer to this imbroglio perhaps lies in what Mr. Shourie himself remarked yesterday, that divestment progress really lies in the PM and the Deputy PM’s hand. Till now Mr. Advani has not publicly taken a stand either for or against divestment. So in that sense, the ball is really in Mr. Advani’s court. Till such time, retail investors will do well to stay away from speculating on PSUs, and if at all they wish to buy either BPCL or HPCL, the stress should be on fundamentals rather than one man’s whims!
More Views on News
Jul 25, 2017
Equitymaster HQ has been infiltrated. Valuable stock ideas have been leaked. Who's responsible?
May 27, 2017
What happens when minority shareholders are short-changed in the normal course of business?
Feb 15, 2017
PersonalFN believes SEBI has taken a step back-apparently in the admission of it going overboard with the regulations.
Aug 24, 2016
And here's your chance to claim a free copy of this book...
Aug 12, 2016
And Why India's demographic dividend could turn out to be a doubtful debt...
More Views on News
Aug 10, 2017
Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.
Aug 10, 2017
Bill connects the dots...between money and growth, real money and real resources, gold and cryptocurrencies...and between gold, cryptocurrencies, and time.
Aug 12, 2017
The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.
Aug 10, 2017
Bitcoin hits an all-time high, is there more upside left?
Aug 16, 2017
Ensure your financial Independence, and pledge to start the journey towards financial freedom today!
Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement. LEGAL DISCLAIMER:
Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here
. The performance data quoted represents past performance and does not guarantee future results.SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: email@example.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407