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Hindustan Petroleum Corporation (HPCL) has reported a 41% decline in net profit for the quarter that ended in March 2022. The profit for this quarter came in at Rs 1,795.26 crores as opposed to Rs 3,017.96 reported in the same quarter last year as the company suffered from weaker margins.
Revenues of the company jumped 24% YoY to Rs 104,942 crores as the company had a Gross Refining Margin of $12.44 per barrel. After adjusting for inventory gains, Gross Refining Margin for the quarter was $6.42 per barrel, improving significantly from last year's $3.5 per barrel. In FY22, the company earned a net profit of Rs 6,382.63 crores and revenue of Rs 3.72 lakh crore, significantly lower than last year.
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"We are looking on passing on increased cost (to consumers). Currently, the prices are so volatile. Two days back, the GRM on diesel was USD 48, yesterday it fell to USD 37. Spikes are so big; we need to see some stability... Also, we need to take a longer-term view as regarding pricing... Let's see how prices fare. In the long term, we will see fuel prices are aligned with cost." said Rajneesh Narang, director of Finance of HPCL.
Oil companies have been unable to increase prices domestically in line with international markets which have stressed their margins. HPCL has been sourcing Russian crude and plans to depend more on them. The company hasn't faced any shortages and is able to meet the market demand.
India is currently in talks with Russia to buy oil at discounted rates. India is the world's third-largest importer and consumer of oil in the world and is suffering from severe inflation like much of the world. Our country has already purchased twice the amount of oil it purchased in 2021 ever since Russia's assault on Ukraine.
The stock of HPCL has been falling for a while as the stock has fallen consistently since mid-April. After the announcement of its results, the stock opened marginally higher but declined again. The stock touched a low of Rs 239.05, a price level that the stock hasn't reached since early in May last year, making this a 52-week low. It currently trades around Rs 240 per share, marking a 19.2% decline since the beginning of 2022.
Article by Aman Agarwal.
This news piece is brought to you in association with jobaaj.com
