The core group of secretaries on divestment is believed to have favoured the appointment of HSBC as the global advisor for managing the privatisation of oil PSU Hindustan Petroleum Corporation.

HSBC has been selected for the much coveted post from among 17 merchant bankers who had made presentations before the divestment ministry last month, government sources said.

The government has invited expressions of interest by March 17 for sale of its 34.01 per cent stake in India's second largest public sector refining and marketing company.

Companies like Reliance Industries, Royal Dutch Shell, Petronas of Malaysia and Kuwait Petroleum Corporation are being touted as the front runners for the government's stake along with management control in HPCL.

Post divestment, state holding in HPCL will fall to 12 per cent as 5 per cent shares would also be sold at concessional price to company employees.

On privatisation of Shipping Corporation of India, the CGD is believed to have also upraised itself of the scenario arising out of only one company - Essar Shipping - being left in fray for Government's 51 per cent stake.

Sources said the CGD mulled over various options for SCI including re-bidding.

A final decision on SCI privatisation will be taken by the Cabinet Committee on Divestment.