The OMC reported Rs 3,018 crore in March quarter profits on the back of inventory gains and rise in refining margins. The company had a net profit of Rs 27 crore in the year-ago quarter.
Following the development, the stock rose 8.14 per cent to hit a high of Rs 288.15 on BSE.
said that the company’s standalone Ebitda and profit were significantly ahead of consensus estimates due to stronger-than-expected crude inventory gains. In absence of details on segment-wise inventory gains, it’s difficult to comment on core refining and marketing margin performances, it said.
“Refining margin outlook continues to be challenging; however, we maintain BUY, with a revised target of Rs 300 per share, on valuation grounds and due to relatively better marketing margin outlook,” it said.
The sales for the quarter rose 19 per cent to Rs. 84,905 crore. “Enhanced profitability was a result of robust operational performance, improvement in refinery margins helped by inventory gains and favorable exchange rate variations,” said HPCL Chairman M K Surana.
The gross refining margin for the quarter was $8.11 per barrel compared to minus $1.23 per barrel in the same quarter last year. The company had an inventory gain of Rs 4,051 crore as against a loss of Rs 2,885 crore in the year-ago period. A 23 per cent jump in oil prices during the quarter contributed to the inventory gain.
The second wave of the pandemic has again depressed fuel demand in the country with petrol and diesel sales falling by about 30 per cent in May compared to the same month in 2019, Surana said, adding that he expected sales to get better in the coming months.
