153% return in 3 years: BPCL shares gain after setting up first-of-its-kind biofuel blend bunker at Mumbai port- Buy, sell of hold?

Shares of state-owned Bharat Petroleum Corporation (BPCL) gained as benchmark equity indices Sensex and Nifty climbed in early trade on Tuesday. The gain in the share price comes after the public sector oil marketing firm said it has set up a biofuel blend High Flash High-Speed Diesel (HFHSD) bunker at Mumbai Port.

The stock opened at Rs 341.65 and gained further to touch the day's high of Rs 342.55 against the previous close of Rs 340.25.

"The facility, the first-of-its-kind by an OMC in the country, provides shipping companies with a cleaner, biodegradable alternative to traditional fuels," the company said in a statement.

This initiative not only supports environmental sustainability but also strengthens BPCL's position as a leader in the Indian bunkering market, it added.

It also aligns with the global mandate to decarbonise the shipping sector apart from one of many green initiatives by the company, BPCL said.

BPCL share price target

Global brokerage firm Citi has maintained its 'Buy' rating on BPCL, with a price target of Rs 380.

Citi said that Oil Marketing Companies (OMCs) are currently in a sweet spot. It has initiated a 90-day positive catalyst watch on BPCL.

The three OMCs have outperformed the broader markets by 17%-37% year-to-date, with most of this outperformance occurring at the beginning of 2024.

BPCL share price history

The counter has given a positive return of 153 per cent in three years and 98 per cent in 2 years. According to BSE Analytics, the counter has gained over 88 per cent in one year. 

BPCL in News

Meanwhile, the company plans to invest Rs 1.7 lakh crore over the next five years to grow its core oil refining and fuel marketing business as well as in 'future big bets' of petrochemicals and green energy, its chairman G Krishnakumar has said.

Bharat Petroleum Corporation Ltd (BPCL), currently, owns about 14 per cent of India's oil refining capacity and about a quarter of the fuel retailing network. It plans to grow these businesses while foraying into newer areas.

The firm is now implementing the first phase of a multi-decade aspirational journey in the form of 'Project Aspire' - its five-year strategic framework that is based on two fundamental pillars - 'Nurturing the Core' and 'Investing in Future Big Bets', he said in the company's latest annual report.