PSU shares found their popularity fading out today after the Opposition launched a tirade against the government's sell-off agenda in HPCL and BPCL in Parliament Thursday.

HPCL, in fact, slumped 4.5% to Rs 272.75 on Friday and BPCL dropped 3.5% to Rs 224.25. Volumes of 13.9 lakh shares were recorded on the HPCL counter on BSE in two-and-a-half hours of trading.

Among other major PSU losers were ITI (down 5.3% to Rs 16.90), RCF (down 4.8% to Rs 22.65), National Fertilisers (down 4.8% to Rs 32.15), Nalco (down 4.8% to Rs 80.90), Dredging Corporation of India (down 4% to Rs 243.50) and Engineers India (down 3.3% to Rs 242).

Some PSU scrips like RCF, Shipping Coporation of India, Bharat Earth Movers and National Fertilisers had surged over the last few trading sessions following the government's divestment initiatives. However, the market's fears over a delay in the government's divestment agenda escalated after the Opposition raised a hue and cry in Parliament on Thursday over the sell-off in HPCL and BPCL .

The Opposition, led by the Congress Party, rocked the Lok Sabha on Thursday over the divestment issue. The Opposition's contention is that the government has not taken Parliament into confidence with regard to the proposed divestment of oil PSUs like HPCL and BPCL. The Congress chief whip Priyaranjan Dasmunshi raised the issue seeking categorical assurance from the government that it would not divest in the oil majors. He contended that over 300 members (except those from the BJP) were opposed to the divestment in HPCL and BPCL.

Disinvestment is seen as a key component of the government's economic reforms process.

The government had already initiated the divestment process in HPCL a few months ago. On the block is a 34% stake in HPCL through strategic sale. The last date for submitting initial bids has already elapsed. A host of foreign companies like the US-based ChevronTexaco, Malaysia's Petronas, Ango-Dutch oil major Shell, British Oil major BP and Saudi Aramco are reported to have put in initial bids for acquiring government control in HPCL. Domestic oil and gas and petrochemicals major Reliance Industries is also reported to have put in a bid and so has Ruia group oil company Essar Oil.

If HPCL's divestment proves successful, the market is likely to be propelled strongly higher.

In a meeting held on 15 April 2003, the Cabinet Committee on Disinvestment also put on the block, through strategic sale, 51% stake in fertiliser major Rashtriya Chemicals and Fertilisers. The CCD also decided to start a fresh round of bidding in the long delayed agenda in shipping major Shipping Corporation of India. In a reversal of a previous decision, the CCD allowed foreign companies to bid for SCI without the previously stipulated cap of 25%.

The government has an 80% stake in SCI and it has put 51% up for sale. The CCD, however, put off the divestment of Air India and Indian Airlines.