MRPL soared to its 52-week high at Rs 24.50 on market hype that recent acquirer ONGC would be making an open offer for an additional stake in the standalone refinery.

Even as the scriip eased from that high subsequently, it was still above Friday's closing by 6.62% to Rs 24.15. Volumes of over 5.21 lakh Mangalore Refinery and Petrochemicals (MRPL) shares changed hands on BSE by 12:25 IST. The stock has now climbed 277% from its 52-week low of Rs 6.40 on 11 September 2002.

Operators are believed to be punting on the counter in anticipation of an open offer from ONGC. Dealers say ONGC's plan is to mop up public equity as well and then delist from the bourses. The public and foreign entities hold 9.57% and 0.82% stake respectively in MRPL.

ONGC announced Friday that on exercising call option for MRPL shares, held by various banks/financial institutions, allotted to them under the debt restructuring package, ONGC has acquired 35,60,04,552 equity shares of MRPL. These shares shall continue to remain as locked in till 29 March 2004. With the above acquisition the holding of ONGC in MRPL now stands at 71.49% from the earlier 51.25% on 31 March 2003.

There's  also news that HPCL may offload its entire stake in ONGC. Currently, HPCL holds 16.97% stake in MRPL.  Buying out the company will not prove too burdensome for ONGC, as it has bulky cash reserves of over Rs 5,000 crore.

Of late, MRPL has been in the limelight on expectations that the company may stage a turnaround following the change in management control (takeover by ONGC). Recently, the company said that it expects to reduce losses sharply in the current year following a restructuring exercise. According to reports, the company expects net loss to decline to Rs 195 crore ($41.4 million) in FY 2003-04 from an estimated Rs 419 crore in the year ended 31 March 2003.

The company also expects to benefit immensely from the crude that will be supplied to it from the Sudan Greater Nile Valley Project. In fact, the first shipment (80,000 metric tonnes of Nile Blend) of crude from Sudan has already arrived at Mangalore, where the refinery is situated. Already, MRPL, over the last few months, has seen capacity utilisation go up from 40% to 90%. With the supply of crude from Sudan, the company could reach 100% capacity utilisation.

The acquisition of MRPL by ONGC is mutually beneficial for both companies, it is being reckoned . It will enable ONGC to set up retail outlets under the marketing rights for transportation fuels. ONGC has been authorised to set up 600 petrol stations in four states.

For the fourth quarter ended 31 March 2003, MRPL reduced its losses to Rs 80.34 crore compared to a loss of Rs 301.89 crore in the corresponding period of the previous year. Net sales increased by 59% to Rs 2,049.60 crore from Rs 1,288.06 crore in MQ 2002.