Analysis of Merger

between
IOC & BRPL
By-
Ankit Agarwal 201

Piyush Deora 212

Jimit Doshi 213

Manish Kumar 232

INDUSTRY OVERVIEW
 1148 billion barrels of oil reserve in the world

 The total demand for crude oil in the world reached

87.2m barrels/day
MAJOR PLAYERS INVOLVED IN THE
PRODUCTION OF CRUDE OIL IN INDIA
ABOUT IOCL
 Indian Oil Corp Ltd (IOCL), a Government of India
company, is the producer and marketer of oil and gas
in India.

 21st leading petroleum company in the world.

 59 innovation patents to its name and many

corresponding International Patents in major
countries.

 A Fortune 500 company, ranked 153 in 2006 i.e. at

the time of proposed merger.
PRODUCT
 Fuel and feedstocks, crude oil, petrochemicals

 Specialities motor spirit/gasoline, lubes, greases

 LPG, high speed diesel/gas oil, superior kerosene

 Furnace oil, bitumen, Aviation Turbine Fuel

 The specialty products include benzene, toluene,

sulphur, paraffin wax, propylene
SERVICES
 Refining

 Pipelines

 R&D

 Petrochemicals

 Marketing

 E&P

 Gas
OPERATIONAL PERFORMANCE
FINANCIAL PERFORMANCE
STOCK PERFORMANCE
ABOUT BRPL
 Incorporated on 20 February 1974 as a public sector
undertaking fully owned by the Govt. of India.

 It is in the business of petroleum refining.

 The Production capacity of 2.35 million tonnes per

annum.

 The company is a major exporter of PSF to

Bangladesh, Belgium, France, Iran, Vietnam, etc.
MAJOR PRODUCTS

LPG, MS, Naptha, ATF, SKO,

HSD,LDO, LSHS, LVFO, RPC
& CPC. DMT and PSF
MERGER DETAILS
 Although approved in NOV 2006, Merger became
effective on 25 March 2009

 Government has decided to sell its stake in BRPL and

Chennai Petroleum Corp Ltd to Indian Oil
Corporation

 Swap ratio of 4:37

MERGER ANALYSIS
 A horizontal merger since both the companies are in
the same line of business also BRPL was a subsidiary
of IOC.

 The country’s largest company by revenues, IOC, got

a tad bigger with the merger.

 The merger may not be too beneficial for IOC in terms

of gaining size but losses sets off in its books to lower
taxes of BRPL.
EVA ANALYSIS
EVA Ratios & Valuation.xlsx