PL First Cut - HPCL Q3FY24 - Marketing margins come in below estimates

PL First Cut – Swarnendu Bhushan – Co-Head of Research, Prabhudas Lilladher Pvt Ltd

HPCL Q3FY24 First Cut: Marketing margins come in below estimates

(CMP: Rs419, MCap: Rs594bn, Rating- Sell)

# HPCL reported lower than expected results with EBITDA/PAT of Rs21.6bn (-74%QoQ; PLe: Rs27.7bn) and Rs5.3bn (-90%QoQ; PLe: Rs9.7bn).

# Refining throughput at 5.3 mmt was down 7% QoQ (PLe:5.4 mmt). Marketing sales including exports improved 11% QoQ to 11.9 mmt

#As per our calculations, GRM came in at US$8.5/bbl (Q2: US$13.3/bbl; PLe: US$6/bbl).

# Gross marketing margin as per our calculations came in at Rs 2.8/litre below PLe of Rs3.8/litre.

# The company declared an interim dividend of Rs15/share

The stock is currently trading at 1.2/1.1x FY25/26 P/BV