MRPL Q4 net profit up 9.6%; to foray into fuel retailing biz

Mangalore Refinery and Petrochemicals Ltd (MRPL) today reported a 9.6 per cent rise in its fourth quarter net profit and said it will foray into fuel retailing by opening 100 petrol pumps.
Net profit in January-March quarter stood at Rs 1,169.70 crore, or Rs 6.67 per share, compared with Rs 1,067.04 crore, or Rs 6.09 a share, in the same period a year ago.
"We had an excellent quarter with a record crude throughput (processing) of 4.12 million tons," MRPL Chairman D K Sarraf told reporters here.
Also, the company had a foreign exchange gain of Rs 168 crore. It earned good refining margin, earning USD 8.56 on turning every barrel of crude oil into fuel in Q4 as compared to a gross refining margin of USD 3.18 a barrel in the same quarter the previous year.

"2014-15 was a very difficult year for refineries and global oil prices slid. Refineries bought crude oil at one price, only to find its value drop the very next day leading to inventory valuation loss," he said.
MRPL had an inventory loss of Rs 2,700 crore in the full fiscal, he said, adding inventory loss in Q4 was Rs 302 crore.

"The refining margin in Q4 was despite an inventory loss of USD 1.59 per barrel. In the full year, the GRM was a negative USD 0.64 a barrel as compared to USD 2.67 per barrel GRM in the previous year. In FY15, we had an inventory loss of USD 4.08 per barrel," Sarraf said.

MRPL ended the fiscal 2014-15 with a net loss of Rs 1,712.23 crore as opposed to a net profit of Rs 601.18 crore in the previous fiscal.
Sarraf said MRPL, which has a license to set up 500 petrol pumps, had in 2010 decided to foray into fuel retailing but the market turned inconducive as standalone refineries like MRPL were not entitled government subsidy and couldn't compete with PSU retailers.
The plan was put on cold storage but with deregulation of petrol and diesel "we feel this is the right time MRPL should re-enter the retailing business," he said.
Sarraf, who is also the Chairman and Managing Director of MRPL's parent, ONGC, said the retailing will start this fiscal but did not put a timeline for setting up 100 petrol pumps.

ONGC also has a license to set up 1,100 petrol pumps but it has decided not to do retailing in its own, he said, adding that within the ONGC Group 1,600 outlets can be set up.