Rosneft in early talks with Reliance to sell Nayara stake: Report

Preliminary conversations have taken place, but the outcome remains uncertain, as valuation remains a major point of contention, said three individuals with direct knowledge of the talks.

A successful acquisition would elevate Reliance past Indian Oil Corporation (IOC) to become India’s largest oil refiner and significantly expand its presence in fuel retail, where it currently operates just 1,972 outlets out of over 97,000 nationwide.

Rosneft is seeking to exit Nayara as Western sanctions have limited its ability to fully repatriate earnings from India.

Potential buyers—ideally firms with significant overseas income—could facilitate quicker offshore payouts. Reliance, being a major fuel exporter, fits that profile.

While Rosneft did not respond to media queries, a Reliance spokesperson stated, “As a policy, we do not comment on media speculation and rumours,” adding that the company regularly evaluates strategic opportunities and remains compliant with disclosure norms under SEBI regulations.

Rosneft acquired Essar Oil, now Nayara Energy, in 2017 for $12.9 billion. Alongside Rosneft, UCP Investment Group, which holds a 24.5% stake in Nayara, is also planning an exit. The remaining stake is held by Trafigura (24.5%) and retail investors.

If a deal is struck, Trafigura is also likely to exit on similar terms.

The stake has been offered to several players, including Reliance, Adani Group, Saudi Aramco, and an ONGC-IOC consortium.

However, most suitors have found Rosneft’s initial $20-billion valuation too steep.

The Adani Group opted out, citing both strategic constraints under its partnership with TotalEnergies and the declining long-term viability of fossil fuels.

Saudi Aramco, which has long sought a downstream presence in India, remains interested. It had previously explored a stake in Reliance’s oil-to-chemicals business and was part of a stalled mega-refinery project in Maharashtra. However, valuation again appears to be a hurdle.

Industry officials suggest that for government-run firms like ONGC and IOC, the value of Nayara’s petrol pumps should not exceed ₹3–3.5 crore per outlet, pegging the marketing network’s worth at $2.5–3 billion—similar to the refinery itself.

Reliance, however, could see more value in the synergies with its Jamnagar twin-refinery complex, located close to Nayara’s unit.

Insiders estimate Reliance might value the retail network at ₹7 crore per outlet ($5.5 billion) and see Nayara’s refinery and planned petrochemical expansion as worth an additional $5 billion, the report said.

Rosneft has reportedly lowered its expectations to around $17 billion, but that figure is still considered high by interested buyers.

No formal deal has been announced yet, and Rosneft has not issued a public statement, the report added.