Hindustan Petroleum Corp.'s quarterly profit fell owing to a jump in its total expenses.
The state-run oil refiner's net profit fell 63.1% over the year earlier to Rs 868.86 crore, according to its exchange filing. That compares with the Rs 2,543.64-crore consensus estimate of analysts tracked by Bloomberg.
Its raw material costs rose 88% year-on-year to Rs 20,355.95 crore.
Revenue, minus excise duty, rose 40.7% year-on-year to Rs 96,602.37 crore, against the Rs 1.03-lakh-crore forecast.
Highlights (YoY)
Operating profit fell 43.3% to Rs 1,870.72 crore.
Other income fell 36.4% to Rs 550.4 crore.
Operating margin contracted to 1.9% from 4.8%.
Total expenditure rose 36.9% to Rs 1,02,812.1 crore.
Gross refining margin—what a company earns by converting one barrel of crude into fuel—stood at an average of $ 4.5 a barrel between April and December 2021.
Higher crude oil led to inventory gains, while an increase in benchmark GRM and improved product spreads supported the refining segment.
The benchmark Singapore gross refining margin rose 402% over the year earlier to $6 a barrel—the highest in two years. Brent crude averaged at $79.7 a barrel compared with $45.26 a year ago. Petrol, diesel, and jet fuel spreads have jumped 342%, 249% and 323% year-on-year.
The company's domestic sales volumes fell 0.8% over the year earlier to 9.95 million metric tonnes because of lower demand for diesel. Its throughput rose 6% to 4.24 MMT.
India's overall consumption of petroleum products, however, fell 3.8% on an annual basis to 53.32 million metric tonnes, according to Petroleum Planning and Analysis Cell data. Consumption of petrol and aviation spirit rose 2.3% and 32%, respectively, while that of diesel fell 3.8%.
Average marketing margins in the third quarter was supported by a cut in fuel taxes and unrevised retail prices of petrol/diesel since the first week of November 2021. The central government reduced the excise duty in November, followed by lowering of value-added tax in several states.
Shares of HPCL ended 1.2% higher on Monday compared with a 1.4% gain in the benchmark S&P BSE Sensex.
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