HPCL posts modest 1.3% rise in pre-tax profit on lower refinery margins

Hindustan Petroleum Corporation (HPCL), a subsidiary of Oil and Natural Gas Corporation (ONGC), has posted a modest 1.3 per cent increase in profit before tax at Rs 1,616.97 crore for the quarter ended September 30, 2019, compared to Rs 1,596.22 crore during the same period last year.

On the other hand, the company’s net profit saw a 3.6 per cent decline to Rs 1,052.31 crore during the July to September quarter of the financial year versus Rs 1,091.98 crore during the same period last year. The company saw a combined gross refining margin (GRM) $2.83 a barrel during the quarter as compared to $4.81 a barrel in the corresponding previous quarter. During the quarter, the company had a foreign exchange (forex) loss of Rs 122 crore compared to Rs 887 crore during the same time in 2018-19.

“Despite a volatile market, operationally we had a stable performance,” said M K Surana, chairman and managing director of HPCL. During the quarter, the company had an inventory gain of Rs 53 crore, compared to Rs 1,276 crore during the second quarter last year. “After adjusting the inventory gain, we had more or less the same GRM during the quarter under review,” he added.

The company’s gross sales during the quarter was Rs 66,165 crore during July to September as compared to Rs 73,065 crore during the same period in 2018. During the second quarter, the domestic sales of petroleum products have increased to 8.95 million tonne (MT) registering a growth of 1.3 per cent over the corresponding quarter of previous year. The sales of petrol increased by 6.3 per cent, LPG by 11.2 per cent and that of bitumen by 8.1 per cent over the corresponding period of previous financial year.

Surana said the company’s refineries are being upgraded to produce transportation fuels meeting BS VI specifications and HPCL will be ready to roll out BS VI fuel on pan India basis as per the scheduled date. On the other hand, the company has already rolled out BS VI fuel in the National Capital Region (NCR) and some districts outside the region too. At present, the higher grade of fuel is available in four districts of Rajasthan, eight in Uttar Pradesh and seven in Haryana.