Bharat Petroleum Corporation Limited (BPCL) is an Indian central public sector undertaking under the ownership of Ministry of Petroleum and Natural Gas, Government of India. It operates three refineries in Bina, Kochi and Mumbai. BPCL is India’s second-largest government-owned downstream oil producer, whose operations are overseen by the Ministry of Petroleum and Natural Gas. It was ranked 309th on the 2020 Fortune list of the world’s biggest public sector undertakings, and 792nd on Forbes’s 2021 “Global 2000” list.
Quarterly Earnings Walkthrough
Bharat Petroleum Corporation Ltd (BPCL) has shown a revival by posting a profit in the December quarter. The company reported a consolidated net profit of Rs 1,747 crore for the third quarter which ended on 31st December 2022. However, the profits have declined by a whopping 36% from the corresponding period wherein the company had reported Rs 2,759 crore.
Revenue from operations have risen considerably by a 25% to Rs 1,19,170 crore during the third quarter versus Rs 95,121 crore in the corresponding quarter of the last year.
The Average Gross Refining Margin (GRM) of the Corporation for nine months ended 31 December 2022 was reported at $20.08 per barrel as compared with $6.98 per barrel during the April to December 2021 period.
The market sales for the nine months ended 31 December 2022 was at 36.01 million metric tonnes (MMT) versus 30.69 MMT for the nine months ended 31 December 2021. This raise is primarily due to Aviation Turbine Fuel (72 percent), High Speed Diesel-Retail (28.5 percent) and Motor Spirit-Retail (19.97 percent) according to the company.
Other expenses for the nine months ended 31 December 2022 have made a drawdown of Rs 1,696 crore due to foreign exchange loss as compared to Rs 5 crore in April-December 2021 period.
The marketing aspect which is under-recovery for the oil marketing companies was disrupted by retail prices which have remained stagnant since April 2022.
Static retail prices with a catalyst of expensive crude oil prices have made a heavy impact on the company’s margins as they will be unable to retrieve the costs for importing and refining the raw material.
Technical Analysis
BPCL stock price has taken heavy support on the 61.8% retracement level twice as we can observe a double bottom candlestick pattern. The price of the stock is currently under the 200-day exponential moving average which denotes the stock to be oversold in the long-term. The stock seems to be adamant at the level of Rs 300 and receives strong support as it cannot break below it. Investors who believe in oil as an energy source for the future may invest into this government stock.
Disclaimer: We do not endorse or encourage you to take trades or investment decisions based upon our posts/research, all of your trading and investment activities are your own and should be taken through consultation with reputed financial advisors. The analysis posted on this website has been created by involving multiple mediums which are present over the Internet.