New Delhi, Nov. 1: ONGC Ltd is in favour of a stock split before its follow-on public offer hits the market in March.

“We would like ONGC to be widely held. It would be better to have more retail investors. The current price of over Rs 1,300 is a case for a share split,” ONGC chairman and managing director R.S. Sharma said.

“ONGC has sent its written recommendation for a share split to the government. Today, ONGC is priced at Rs 10 per share. We have suggested that it can be split into two,” he said.

The ONGC share closed at Rs 1,319.35, up 1.07 per cent over its Friday’s close of Rs 1,304.05 on the National Stock Exchange today.

The company still needs to appoint five more independent directors to comply with the market regulator’s listing requirements.

The government has already shortlisted candidates as independent directors, Sharma said.

The government plans to sell 5 per cent of its shares through a follow-on public offer in March and expects to mop up Rs 10,800 crore.

After the offer, the government’s shareholding will come down to 69.14 per cent from 74.14 per cent.

Diesel prices

The complete deregulation of diesel prices seems to have been put on the backburner with the government today stating that it was working on a subsidy mechanism and ruling out dual pricing of the transport fuel.

“We are working on a (subsidy) mechanism as it’s very difficult to implement the dual pricing of diesel,” petroleum minister Murli Deora said.

The government, which had partially de-regulated diesel prices, was planning to have dual prices for the preferred transport fuel.

According to Deora, “The retailer will find it difficult to know whether diesel is bought for farm purposes or for other use. At the same time, the government is trying to streamline diesel retail sale,” Deora said.