The long-term borrowing plan is not in synergy with HPCL's current strategy for growth, which is essentially to make small capital investments in big ventures. Hindustan Petroleum's debt to equity ratio has actually tapered down to 0.18 : 1 from 0.39 : 1 in 1993-94. In the meanwhile, its accumulated reserves have grown to Rs 4090.96 crore.

Over the coming four years the Rs 20,512-crore-turnover petroleum refining and marketing company will fund projects worth Rs 10,321 crore, essentially out of its internal accruals, short-term borrowings and concessional loans from the Oil Industry Development Board (OIDB).

As a matter of fact, thecompany had planned a Rs 500 crore bond issue last year, but decided against it, when the oil bonds became available. Hindustan Petroleum's share of the 10.5 per cent bonds issued to oil companies in lieu of their dues from the oil pool account was Rs 994 crore.

Zutsi acknowledged that borrowings would not be necessary for the projects on hand. ``Our internal generation is 65 per cent,'' said HPCL's director, finance, S. D. Gupta, to drive home the fact that the company would not have to resort to the debt market because of an unforseen financial crunch.

Last year HPCL earned a net profit of Rs 701.16 crore, which was a 14.53 per cent increase over the previous year, despite the 22 per cent drop in its refinery throughput because of the fire at its Visakhapatnam refinery. Its sales turnover went up by 13.4 per cent and its sales volume jumped 3.5 per cent to 16 million tonne.

The HPCL strategy has been to grow big at a minimal capital investment, which compels the public sector enterprise (PSE) toresort to joint ventures with a modest equity stake of 26 per cent. Joint ventures, like a nine million tonne per annum-capacity refinery in Punjab, liquefied petroleum gas (LPG) import facilities at Visakhapatnam and 32 LPG bottling plants across the country, will take up only Rs 2,168 crore of the Rs 10,321 crore of investment planned till the year 2002.

The rest of the investment will be in upgrading existing facilities like its Mumbai refinery (Rs 1495 crore), expanding its Visakhapatnam refinery by adding three million tonne of fresh capacity (Rs 2601 crore) and beefing up its marketing muscle and outlets (Rs 4097 crore).

The company Zutsi perceives as ``a world class player in the field of energy'' has other ventures up its sleeve though, which do not yet figure in its Ninth Plan investment schedule. The six million tonne West Coast refinery, which got somewhat of a setback when its joint venture partner Oman Oil Company decided to opt for Bharat Petroleum Corporation as a partner for an ``inlandrefinery'' instead, is one such venture.

Zutsi emphasised that the West Coast refinery had been ``deferred till the 10th Plan'' period. The nearly Rs 4000 crore liquefied natural gas (LNG) import terminal and regassification project planned with Total of France as a partner, is another HPCL venture that will only come alive when feasibility studies are complete.

The HPCL chief would not specify which ventures would prompt the practically no-debt blue chip in the PSE stable, to angle for the debt market. ``Once we have the critical marks, we may look at things differently,'' he said, referring to HPCL's plans of getting itself rated.