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Oil stocks rally on hopes of gas price hike; ONGC surges as much as 11.5%

LiveMint logoLiveMint 06-06-2014 Promit Mukherjee

Mumbai: Oil stocks rose sharply on Friday morning on reports that the gas price hike is likely to happen by the beginning of July, with a possible hike in prices of kerosene and LPG also in the offing.

Both pieces of news had a positive impact on oil and gas stocks, led by India’s biggest crude oil producer Oil and Natural Gas Corp. Ltd (ONGC) which jumped as much as 11.5% to `467.95. The scrip closed 10.57% higher at `464.

Oil India Ltd (OIL), another government-owned explorer, jumped 6%. Oil marketing companies, led by Reliance Industries Ltd, also saw substantial gains in share prices on Friday.

Analysts say the major beneficiary of the gas price hike will be ONGC which could see incremental revenues of almost `5,000 crore flowing to its kitty within a year of the price hike. An increase in kerosene and LPG prices, and the current spate of diesel deregulation, will also prove to be an added advantage for the company.

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