Purnendu Chatterjee has questioned the price at which Indian Oil Corp is being offered the 7.5% stake in Haldia Petrochemicals Ltd. Mayhem continues to prevail as IOC, which has already paid Rs 150 crore for the proposed stake, is now waiting for HPL to encash the cheque and allot it the shares. The last date of encashing the IOC cheque is August 18.
Chatterjee, seeking more time to acquire the government's 36.87% stake, has questioned the Government rationale behind IOC being allotted shares at par (Rs 10), whereas he was asked to shell out Rs 29 for each share of HPL. When the HPL board approved Indian Oil's contribution of Rs 150 crore and accepted the cheque, the share price was not calculated. However, when the Bengal government decided to offer its stake to TCG, a valuation was carried out and the share price was fixed around Rs 30. In the event of IOC being asked to pay at Rs 29 per share, it will get a paltry 2.5-3% in HPL. This inadequate stake will definitely dampen IOC's prospects of acquiring management control of HPL.
Also, HPL had registered a net profit of Rs 750 crore in 2004-05, and the positive performance continues into Q1-2005. This trend is expected to continue throughout the year. Will the robust financial results get reflected in the share price? Does this indicate the need for fresh valuation of the shares of HPL?
03-Aug-05 
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