MOSL: BPCL (Buy)-EBITDA significantly below estimate-core GRM at USD6.5/bbl
BPCL: EBITDA significantly below estimate; core GRM at USD6.5/bbl
(BPCL IN, Mkt Cap USD15.8b, CMP INR475, TP INR549, 16% Upside, Buy)
- BPCL reported core EBITDA of INR15.9b (est. of INR25.9b; -21% YoY, -44% QoQ). This was lower than our estimate (despite above-estimate core marketing margin) due to higher other expenditure (+15% YoY, +10% QoQ). It reported inventory gain of INR10.3b in refining and INR5.7b in marketing, resulting in EBITDA of INR32b (est. of 34.3b; -8% YoY, -10% QoQ). Forex loss stood at INR4.8b, as against a loss of INR1.5b in 3QFY17 and a gain of INR5.6b in 2QFY18. Lower tax rate resulted in PAT of INR21.4b (-6% YoY, -9% QoQ), higher than our estimate of INR20.9b.
- Core GRM of USD4.9/bbl was slightly higher than our estimate of USD4.7/bbl. Core GRM stood at USD3.6/bbl in 3QFY17 and USD6.5/bbl in 2QFY18. Inventory gain stood at USD3/bbl in 3QFY18 v/s USD2.3/bbl in 3QFY17 and USD1.5/bbl in 2QFY18. Kochi refinery reported core GRM of meager 4.1/bbl, suggesting that expansion there is yet to stabilize.
- Domestic sales volume grew 9% YoY (+9% QoQ) to 10.7mmt in 3QFY18. Throughput in 3QFY18 stood at 7.3mmt v/s 6.8mmt in 3QFY17 and 7.0mmt in 2QFY18. Implied gross marketing margin, including inventory gain, declined 14% YoY and 12% QoQ to INR3.8/lit.
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.
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.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.