Newsletter
State-run oil company BPCL has acquired a 40% stake in Tiki Tar and Shell India for ₹85 crore, strengthening its presence in the road construction materials business.
Tiki Tar and Shell India manufactures bitumen-based products used to build and maintain roads, including modified bitumen and emulsions that help roads last longer and perform better.
Why does this matter: BPCL already produces bitumen at its refineries. By investing in a company that makes value-added road construction products, it can move further down the value chain instead of just selling the raw material.
The bigger picture: India has the world's second-largest road network, making it a huge growth market for bitumen. As the country builds more highways and roads, demand is expected to keep rising, with the bitumen market projected to reach $5.6 billion by 2035.
The growth is also expected to be supported by exports to neighbouring countries.
But the real growth is expected to come from value-added products like bitumen emulsions and modified bitumen, which are used to build stronger, longer-lasting roads.
Demand for these products is expected to grow much faster than regular bitumen as India pushes for more sustainable infrastructure and works towards its net-zero goals.
Stock action: shares of the company fell nearly 3%, in line with other oil marketing companies, as global crude oil prices surged.
