With this, India joins countries such as the US and Australia where fuel prices are revised on a daily basis. This means OMCs will be able to pass on daily changes in product prices and exchange rate fluctuations without delays. IOC said daily revision of petrol and diesel prices will set new standards of transparency, encourage the automation drive of petrol pumps and lead to better stock management practices. Every Re0.1/litre increase in petrol/diesel price adds 1.9-3.5% to OMC earnings per share, according to Credit Suisse Securities (India) Pvt. The sharp appreciation in the last one year and the above mentioned concerns could well limit meaningful upsides for these OMC stocks.

Source: Mint June 21, 2017 02:25 UTC