 "HPCL calls for emergency board meeting to clear the revised fiscal package")
HPCL, the state-owned oil marketing company (OMC), said on Thursday its standalone net profit increased more than three times to Rs 529 crore in the third quarter of Financial Year 2023-24 (Q3 FY24), up from Rs 172.4 crore in the same period in FY23.
On a sequential basis, net profit fell 89 per cent from Rs. 5,118.1 crore registered in Q2 FY24. The sharp deterioration was due to suppressed marketing margins at select transport fuels and lower refining margins attributable to lower cracks. A crack, or crack spread, is a term used in the energy markets to represent the differences between a barrel of crude oil and the prices of wholesale petroleum products.
HPCL blamed the decline in Q2 FY24 to falling crude prices as well. Brent crude prices hit a high of Rs 94.3 per barrel on September 27, but expectations of lower industrial demand in China and inflationary fears in Europe have driven down demand. Prices stood at Rs 79.93 Thursday evening.
HPCL's income from sale of products increased 1.9 per cent to Rs 1.17 trillion in Q3 FY24 compared to the year-ago quarter. The small improvement was attributed to lower average gross refining margins (GRM) in the latest quarter. GRM is the amount that refiners earn from turning every barrel of crude oil into refined fuel products. HPCL said GRMs fell to $8.49 per barrel in Q3 FY24, down from $9.14 per barrel in Q1 FY23.
In the first nine months of FY24, the company’s average GRMs touched $9.84 per barrel. This was lower than the $11.40 per barrel registered in the first nine of FY23.
Also Read
Revenue from other business activities rose 84 per cent to Rs 627 crore in Q3 FY24. It was Rs 339 crore in the same quarter of the previous year. The company said it has earned Rs. 131.48 crore towards gain on account of foreign currency transactions and translations.
HPCL’s board approved an interim dividend of 150 per cent, or Rs 15 on each equity share of Rs 10. Shares fell 4.9 percent to Rs 431.9 on Thursday after the quarterly results were released.
The OMC said construction activities progressed over the quarter at its 9 million metric tonnes per annum integrated refinery cum petrochemical project at Balotra in Rajasthan. The refinery, a joint venture with the Rajasthan government, was announced in 2013.
The initial estimate of the project, touted as the largest of its kind, near Pachpadra town in Barmer district was Rs 43,129 crore and has increased to Rs 72,000 crore.
"With daily average manpower deployment at site of about 28,000, progress is being accelerated at all fronts to ensure mechanical completion of the Refinery followed by the Petchem units. In this regard, pre-commissioning activities for several units have already started," the company said.
March 2024 remains the tentative deadline for setting up all the refinery units, but four of the units may reach operational levels in the next three months.
In Q3 FY24, HPCL commissioned 162 retail outlets, taking the total number to 21,593 nationwide.
