Fitch Ratings sees risks to OMCs as Centre seeks more returns

BPCL and OIL are likely to invest in an upcoming Mozambique LNG project after a final investment decision on the project

Financial profiles of state-owned oil marketing companies such as Indian Oil Corp (IOC) may be at risk in the near to medium term due to pressure from the Central Government to increase shareholder returns, Fitch Ratings said on Friday.

Struggling to meet budget targets, the Government had in the recently concluded fiscal (2018-19) asked cash-rich public sector units (PSUs) to pay second interim dividend as well as undertake share buyback. The share buybacks, wherein a company re-purchases its shares and extinguishes them, helped the government get money while maintaining its control over them.