IOCL Withdraws Rs 22,000 Crore Rights Issue Following Government's Budget Decision

Indian Oil Corporation Limited (IOCL) has withdrawn its Rs 22,000 crore rights issue of equity shares. The decision followed the government's move not to allocate capital support funds to oil marketing companies in the 2024-25 Union Budget.

Indian Oil Corporation Limited (IOCL) has decided to withdraw its previously proposed rights issue of equity shares worth Rs 22,000 crore. The decision was made during a Board meeting on September 30, following the government's decision not to allocate funds for capital support to oil marketing companies (OMCs) in the Union Budget for 2024-25.

This reversal comes after the company's announcement on July 7, where the Board had approved capital raising through a rights issue, subject to statutory approvals. The anticipated Rs 30,000 crore allocation for OMCs in the Union Budget did not materialize, with the Ministry of Petroleum and Natural Gas confirming no funds had been earmarked.

In light of the government's non-participation, IOCL's Board decided to withdraw the rights issue during the meeting. Company Secretary Kamal Kumar Gwalani confirmed the move, stating, 'In view of the Govt. of India's (Promoters) non-participation in the Rights Issue, the Board has decided to withdraw the proposed issue of equity shares.' The company had planned to use the funds for capital expenditure and expansion projects, but the government's decision has led IOCL to reassess its strategy.

Additionally, the Board meeting addressed IOCL's other business ventures, including a joint venture with Sun Mobility Pte. Ltd. for battery-swapping services in India, with an Rs 1,800 crore investment by FY2026-27, along with other international investments. (ANI)

(With inputs from agencies.)