Shares of Castrol India witnessed a significant surge of over 13% on Thursday following reports that Saudi Aramco, the world’s largest oil company, is considering a potential bid for BP’s lubricant business, which operates under the Castrol brand.
Market Performance
Castrol India’s stock climbed 13.36% to ₹252 per share on the Bombay Stock Exchange (BSE) and 13.32% to ₹251.95 on the National Stock Exchange (NSE). This marks the fourth consecutive session of gains for the company, reflecting strong investor sentiment. The broader market indices also showed positive momentum, with the BSE Sensex rising by 400.91 points and the NSE Nifty gaining 126.70 points during mid-session trading.
Aramco’s Strategic Interest
According to reports, Saudi Aramco is evaluating whether to acquire BP’s entire lubricant division or specific assets under the Castrol brand. The potential acquisition is part of BP’s strategic restructuring, which values its lubricant business at approximately $10 billion. Aramco may consider integrating Castrol’s assets with its Valvoline lubricants unit, which it acquired in 2023 for $2.65 billion.
Aramco’s interest in Castrol aligns with its strategy to expand its refining and chemical operations in high-growth markets such as India, China, and Southeast Asia. The move underscores Aramco’s commitment to strengthening its presence in the global lubricant market.
Castrol India’s Financial Highlights
Castrol India, a subsidiary of BP, has demonstrated robust financial performance. In the December quarter, the company reported a 12% year-on-year increase in profit after tax (PAT) to ₹271 crore, with revenue from operations rising by 7% to ₹1,354 crore. The company’s extensive distribution network, reaching over 143,000 outlets across India, has been a key driver of its growth.
Looking Ahead
While discussions are reportedly in the early stages, the potential acquisition has already sparked significant interest in Castrol India’s stock. Investors and industry experts will closely monitor developments as Aramco evaluates its next steps in this strategic move.
This surge in Castrol India’s shares highlights the growing anticipation surrounding Aramco’s potential entry into the Indian lubricant market, setting the stage for a transformative deal in the energy sector.
