Motilal Oswal - Bharat Petroleum Corporation Limited (BPCL) MOSL: BPCL (Buy)-Core GRM at a premium to benchmark

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Motilal Oswal

Swarnendu Bhushan

EUR 120.00 For Business Accounts Only

MOSL: BPCL (Buy)-Core GRM at a premium to benchmark

BPCL: Core GRM at a premium to benchmark

(BPCL IN, Mkt Cap USD10.4b, CMP INR343, TP INR465, 36% Upside, Buy)

BPCL reported a GRM of USD2.8/bbl, lower than our estimate of USD3.0 and USD7.5 in 1QFY19. Consequently, EBITDA was down 53% YoY/QoQ at INR21.5b, despite a decline of INR1.6b in other expenses.
EBITDA was up 37% YoY at INR26.0b, with the refining inventory loss at INR1.3b and the marketing inventory loss at INR3.3b.
Forex gain was at INR0.3b for the quarter (v/s a loss of INR7.1b in 1QFY19 and a gain of INR2.8b in 4QFY19). Reported PAT was at INR10.8b (-53% YoY).
BPCL has reported first-quarter earnings based on Ind-AS 116. Depreciation expense increased by 24% YoY and interest cost by 50% YoY. PBT came in at INR13.5b (and at INR14.0b adjusting for Ind-AS impact of INR0.5b).

14/08/2019 1 EN

Underlying

Bharat Petroleum Corporation Limited

Bharat Petroleum refines crude oil and markets petroleum products in India. Co. offers fuels and services, as well as lubricants, including automotive engine oils, gear oils, transmission oils, specialty oils, and greases; and liquid and gaseous fuels, illuminating oils, and other products from crude petroleum or bituminous minerals. Co. is engaged in the retailing of petrol, diesel, and kerosene. Co. also imports and exports fuel oil, naphtha, and base oil. Co. serves household and automobile sectors; public and private sectors; and various government establishments, such as defense, railways, state trading corporations, state electricity boards.

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INE029A01011 National Stock Exchange of India India

Provider

Motilal Oswal

Motilal Oswal Financial Services Ltd. is a reputed name in Financial Services and Online Trading with group companies providing services such as Private Wealth Management, Retail Broking and Distribution, Institutional Broking, Asset Management, Investment Banking, Private Equity, Commodity Broking, Currency Broking, Principal Strategies & Home Finance.

Motilal Oswal Securities is a group company of Motilal Oswal Financial Service Limited which started as a stock trading company and has blossomed into well diversified firm offering a range of financial products and services. Motilal Oswal has built a reputation as the source for best stock trading company and this has taken a wealth of experience, knowledge and expertise, constantly working in tandem, over the years.

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Analysts

Swarnendu Bhushan

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MOSL: BPCL (Buy)-Core GRM at a premium to benchmark

BHARAT PETROLEUM sees an upgrade to Slightly Positive due to a better fundamental star rating

MOSL: BPCL (Buy) - Better-than-expected result; reiterate it as the preferred pick in OMCs

Monthly LMI Update Independent Investment Research

MOSL : HOME FIRST FINANCE COMPANY: Earnings in-line with sustained improvement in asset quality

MOSL : SHOPPERS STOP: Ticking the right boxes

MOSL : ERIS LIFESCIENCES: Enhanced efforts toward product launch-related activities

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