InvestorQ : With government increasing excise duty on petrol and diesel what happens to petrol price and what will be impact on OMCs like Indian Oil and BPCL?
Dia Deshpande made post

With government increasing excise duty on petrol and diesel what happens to petrol price and what will be impact on OMCs like Indian Oil and BPCL?

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Ria Jain answered.
7 months ago
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The government has decided to impose an additional excise duty of Rs.10/litre on petrol and Rs.13/litre on diesel. However it is still now clear who will bear the burden as it is a huge hit. Government sources have indicated that the OMCs may be asked to take the burden instead of putting the load on people in the midst of the pandemic. If that is the case, then it is likely to be negative for the 3 major OMCs in India; IOCL, BPCL and HPCL. That is because, this hike in excise duty will not be passed on to the end customer but will be absorbed by the OMCs and that will directly hit their profit position. In the last five years, the government has been consistently using excise duty on petrol and diesel to enhance its revenues. For OMCs this may be one more hit in the midst of a tough market.

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