IOC to infuse Rs 1,000 crore in Chennai Petroleum.

Chennai Petroleum Corporation Ltd. (CPCL), a group company of Indian Oil Corporation (IOC), will raise around Rs 1,000 crore from its parent to strengthen its net worth. This, in turn, is expected to help the company borrow more to complete its Rs. 3,110 crore upgradation project to improve profitability.

The capital will also help the company to reduce working capital burden, a company official said.

CPCL has approved the issue of 100 crore Non convertible Cumulative Redeemable Preference Shares of Rs. 10 each, in more than one tranche, to IOCL.

CPCL has came under pressure due to global crude prices. The company earlier told the Board of Industrial and Financial Reconstruction (BIFR) that following continuous losses, it could not raise capital from the parent.

Howeve conditions have improved since February and gross refining margin (GRM) has also increased to $5.85 a barrel, a company official said.



BS