New Delhi, Oct. 30: There is a deep sense of resentment within Hindustan Petroleum Corporation (HPCL) over the fact that the stalled disinvestment process has allowed its rivals, notably Reliance Industries, to ferret out its trade secrets through the due diligence exercise that the department of disinvestment (DoD) had pushed through with unseemly haste.
Senior executives in the oil industry reckon that the due diligence exercise preparatory to the sale of the government stake which has since been stalled by a Supreme Court ruling has seriously compromised the interests of HPCL.
The general impression is that the DoD does not understand the complexities of the oil business and the early launch of the due diligence process was a serious faux pas.
Sources disclose that just before the Supreme Court announced its verdict to halt the sale of HPCL, Reliance had carried out its due diligence exercise with around 40 executives representing the company descending on the HPCL office every day to pore over the books of the blue-chip oil major.
However, the Supreme Court verdict that put an end to the sale has stopped the other contender Shell from going ahead with the same exercise.
Senior executives say the strategy evolved by HPCL to expand its operations and market share has been needlessly exposed to Reliance, which can now emulate the same tactics and even take counter measures.
The petroleum ministry had in fact asked DoD to wait until the Supreme Court verdict on the sale of HPCL came through.
However, DoD, headed by Arun Shourie, ignored the advice as it was working on the assumption that the Supreme Court would give the go-ahead for the sale of the blue-chip oil major.
However, this assumption has turned out to be wrong. It has also put HPCL in a disadvantageous position vis-a-vis a competitor.
Some officials are of the view that Reliance in any case hires executives who have retired from senior positions from public sector oil companies and have an insight into the operations.
But, they also admit that the comprehensive picture that can be picked up from the books of the company which has an all-India presence goes far beyond the memory of an odd executive who retains only bits and pieces of such information.
Some HPCL officials are of the view that the government should compensate HPCL for this damage by allotting it prime locations on the golden quadrilateral highway linking Delhi-Calcutta-Chennai-Mumbai-Delhi. This highway project, which involves the six-laning of the golden quadrilateral and the building of several bypasses and bridges, is seen as the next most sight-after marketing section by the oil companies.