Confidence Petroleum India Jumps Over 15% On Entering Into JV With a Norwegian Company

On Monday, Confidence Petroleum India shares surged 15.44% to trade at a fresh 52-week high of Rs 119.95, from its previous closing of Rs 103.91 on the BSE.

About the Joint Venture

Confidence Petroleum India Ltd, one of the major LPG-CNG companies in India, and BW LPG, a prominent Norwegian-listed company specialising in LPG shipping and trading, have formed a strategic alliance to enhance LPG terminal infrastructure and downstream operations throughout India. The collaboration is geared towards fortifying the onshore LPG import infrastructure in the country.

As the world’s largest owner and operator of Very Large Gas Carriers (VLGC), BW LPG holds a significant position in global LPG shipping and trading. Its Indian subsidiary, BW LPG India, plays a crucial role in India’s LPG imports and time-charter market.

BW LPG has made investments in Confidence Petroleum and established a joint venture known as “BW Confidence Enterprise” (“BW Confidence”). This venture focuses on investing in onshore LPG import infrastructures in India, with an ongoing project in Mumbai to develop one of the country’s largest cryogenic LPG storage facilities. The joint venture also aims to facilitate LPG supply into India.

As part of this collaboration, BW LPG has invested $30 million in Confidence through a preferential allotment of equity shares, constituting 8.50% of the issued and paid-up share capital of Confidence on a fully diluted basis. This infusion of capital will support Confidence Petroleum in expanding its capacity in LPG downstream assets.

Confidence Petroleum India has envisioned growth by expanding its current infrastructure of over 68 LPG bottling plants to 100, adding 500 Auto LPG Dispensing Stations, and establishing 200 CNG Stations within the next three years. These expansions align with Confidence Petroleum India Limited’s ambitious plan to achieve a revenue of 10,000 crore in the coming three years.

Company profile

Confidence Petroleum India Ltd is engaged in manufacturing of LPG cylinders and is also a supplier of auto LPG in India with its network of bottling plants and Auto LPG dispensing stations across India. It also supplies packed LPG cylinders and is also engaged in LPG bottling catering to industrial and commercial customers.

Stock price movement

Today, the stock opened at Rs 109.90 and has touched a high and low of Rs 119.95 and Rs 107.29, respectively. The BSE group ‘A’ stock of face value of Rs 1 has a 52-week high and low of Rs 119.95 and Rs 55.28, respectively. Last one week high and low of the scrip stood at Rs 119.95 and Rs 89.46, respectively. The current market cap of the company is Rs 3,289.08 crore.

The promoters holding in the company stood at 61.63%, while Institutions and Non-Institutions held 3.38% and 35.00%, respectively.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.