MOSL: IOCL (Buy)-Core GRM muted at USD3.0/bbl; healthy marketing margins
IOCL: Core GRM muted at USD3.0/bbl; healthy marketing margins
(IOCL IN, Mkt Cap USD18.9b, CMP INR143, TP INR194, 36% Upside, Buy)
Reported EBITDA was lower than our estimate at INR47.1b (-50% YoY). Total inventory loss stood at INR11.8b (refining loss at INR15.3b and marketing gain at INR3.6b). EBITDA adjusted for inventory and one-offs was higher by 16% YoY at INR58.9b.
Forex loss for the quarter was at INR11.4b, which resulted in PBT of INR8.1b. Tax rate stood at 30.8% versus our estimate of 21.7%, as the company did not opt for lower tax rates and continued taking advantage of MAT credit. PAT for the quarter stood at INR5.6b (-83% YoY).
** An amount of INR20.6b has been carried as liability at end-1HFY20 owing to the expected revision of pay and allowances for workmen.
** For 1HFY20, reported EBITDA was lower by 45% YoY at INR129.7b, while PAT was down 59% YoY to INR41.6b. Total inventory gain was at INR0.6b versus INR123b in 1HFY19. Adj. EBITDA was up 6% YoY at INR122.8b.
Indian Oil is engaged in the sale of imported crude oil; and exploration of petrochemicals, and oil and gas. Co.'s products include liquefied petroleum gas, natural gas, petrol/gasoline, diesel/gas oil, aviation turbine fuel/jet fuel, lubricants and greases, marine fuels and lubricants, kerosene, bulk/industrial fuels, bitumen, petrochemicals, and crude oil. Co. also provides other products, which comprise benzene, carbon black feed stock, food grade hexane, jute batching oil, micro crystalline wax, mineral turpentine oil, paraffin wax, propylene, raw petroleum coke, sulphur, and toluene.
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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