BPCL stock surges 5% on 1:1 bonus issue; hefty dividend announcement

BPCL stock update: The state-owned oil marketing company reported a 30% year-on-year decline in a consolidated net profit of Rs 4,790 crore in Q4FY24.

Shares of Bharat Petroleum Corporation (BPCL) rallied 5 per cent to Rs 621.80 on the BSE in Friday’s intra-day trade after the company's board recommended issue of bonus shares in the ratio of 1:1 i.e. one new bonus equity share for each existing share.

The board also has recommended a final dividend of Rs 21 per equity share of face value of Rs 10 each (pre-bonus), which translates into final dividend of Rs 10.5 per equity share (post-bonus).

The board has fixed June 22, 2024 as record date to determine the eligibility of shareholders to receive bonus shares. The record date for the final dividend will be intimated separately, BPCL said in an exchange filing.

At 09:23 am; BPCL was trading 3 per cent higher at Rs 612.15, as compared to 0.13 per cent rise in the S&P BSE Sensex.

Meanwhile, the state-owned oil marketing company reported 30 per cent year-on-year (YoY) decline in consolidated net profit at Rs 4,790 crore for the fourth quarter (January-March) of FY24 when compared with Rs 6,870 crore in the corresponding quarter of the previous year. Sequentially, BPCL saw its net profit rise 50.5 per cent from the Rs 3,181 crore registered in the preceding quarter.

During Q4FY24, BPCL had impaired investments of Rs 1,800 crore in its subsidiary company BPRL due to change in prospects of its blocks. The accumulated impairment loss on investments in Bharat PetroResources Limited (BPRL) as of Mar 31, 2024 is Rs 5,200 crore.

The reduction in net profit in Q4 may have been due to lower gross marketing margins on petrol and diesel. Margins had reduced to an average of Rs 8 and Rs 3.4 per litre, respectively, during the quarter, according to a note by Motilal Oswal. On the other hand, a pump price cut of Rs 2 since March 15 may have reduced retail margins as well. The brokerage firm has a ‘neutral’ rating on BPCL.