PTC India approves ONGC's bid to buy arm for ₹925 cr; stock zooms 9%

Shares of state-owned power trading company PTC India zoomed 9% in intra-day trade on Friday after its board approved ONGC's bid to acquire its wholly owned subsidiary PTC Energy Ltd (PEL) for ₹925 crore.

PTC India shares opened a gap up at ₹138.35 and surged to an intra-day high of ₹151.45, up 8.8% from the previous session close on the BSE. The PTC India shares are trading 7.2% down compared to the 52-week high hit on September 12, 2023. At the current share price of ₹146.95, the m-cap of the company stands at ₹4,349.84 crore.

Shares of PTC India have given a 7.55% return in the past week; 5.92% in the past month; 58.96% in the past six months, 72.60% in the year-to-date period; and 103.46% in the past year.

"PTC India Ltd. in its Board Meeting held today (19t October 2023) has approved the bid submitted by M/s ONGC Ltd. for the acquisition of a wholly owned subsidiary of PTC India Limited i.e. PTC Energy Limited (PEL) at an equity value of ¥ 925 Crores (INR Nine Hundred Twenty Five Crores) subject to adjustments in bid value as per the bid format," PTC India informs via stock exchanges.

The transaction, however, is subject to the fulfillment of conditions precedent, other terms and conditions as per the share purchase agreement, and shareholders’ approval.

PTC India's consolidated profit in Q1 FY24 stood at ₹143 crore, while the earnings per share of the company increased to ₹4.39 per share.

PTC India trades electricity with Bhutan, Nepal, and Bangladesh from large power projects, including renewables as well as short-term trading arising as a result of supply and demand mismatches, which inevitably occur in various regions of the country.

PTC India is 83.78% owned by the public, while 16.22% is owned by the promoter and promoter group.

The Oil and Natural Gas Corporation (ONGC) stock, meanwhile, remains trading flat today. The stock opened at ₹186.95 and surged to an intra-day high of ₹187.05 on the BSE. At the current share price, the scrip is trading down 3% from the 52-week high of ₹192.25 touched on September 29, 2023.

ONGC also inked a Memorandum of Understanding (MoU) with NTPC Green Energy Ltd (NGEL) last month to realise its renewable energy objectives toward energy transition on 27 September 27, 2023. The MoU will allow the companies to collaborate on renewable power projects in India and overseas through offshore wind projects and exploring opportunities in the storage, e-mobility, carbon credits and green credits, nuclear, green hydrogen business and its derivatives.

Also, ONGC last month inked a pact with Mangalore Refinery and Petrochemicals Limited (MRPL), which is the largest single-location PSU refinery in the country. The agreement will allow the sale and purchase of crude oil and will be applicable till March 31, 2024.