During Thursday’s trading session, the shares of a company engaged in refining crude oil and marketing petroleum products surged nearly 2 percent to Rs. 417.75 on BSE, after the company’s Board approved the construction of the Visakh Raipur Pipeline Project with an investment of Rs. 2,212 crores.
With a market capitalisation of Rs. 88,102.5 crores, at 10:31 a.m., the shares of Hindustan Petroleum Corporation Limited (HPCL) were trading in the green at Rs. 413.85, up by 1.04 percent, as against its previous closing price of Rs. 409.6.
What’s the News:
According to the latest regulatory filings, the HPCL Board approved the Visakh Raipur Pipeline Project investment and Visakh Refinery Modernization Project (VRMP) revision in cost and completion schedule.
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The Board has approved the construction of a pipeline extending from Visakhapatnam to Raipur and allied facilities including the Depot at Kantabanji, with an estimated cost of Rs. 2,212 crores.
This project aims to provide a strategic advantage for the evacuation of products for the expanded capacity of Visakh Refinery after implementing the Visakh Refinery Modernisation Project in optimising placement costs and enabling product distribution to eastern, central and northern parts of India.
In addition, the cost for the VRMP has been revised to Rs. 30,609 crores, with a projected mechanical completion by October 2024.
Majorunits of the VRMP are already operational, and the Resid Upgradation facility is expected to be commissioned soon. Upon completion of the VRMP Project, the Visakh Refinery will operate at its full capacity of 15 MMTPA, including bottom upgradation facilities.
Financials:
The company experienced marginal growth in its revenue from operations, showing a year-on-year rise of around 1.6 percent from Rs. 1,12,079 crores in Q1 FY24 to Rs. 1,13,888 crores in Q1 FY25.
However, its net profit decreased during the same period from Rs. 6,766 crores to Rs. 634 crores, indicating a decline of nearly 90.6 percent YoY.
The primary reasons for lower PAT were suppressed marketing margins on select petroleum products and reduced refining margins.
HPCL recorded the highest-ever quarterly sales volume of 12.63 MMT (including exports) during Q1 FY25, registering a growth of 6.6 percent, as against 11.85 MMT during Q1 FY24.
During the period, the company also achieved a market share gain of 0.25 percent amongst PSU Oil Marketing Companies.
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Stock Performance
In the previous six months, the stock has delivered positive returns of nearly 20.6 percent, while around 146.6 percent of multibagger returns in one year. So far in 2024, the shares of HPCL have given about 55.2 percent of positive returns.
About the Company:
Hindustan Petroleum Corporation Limited is engaged in the business of refining crude oil and marketing petroleum products, production of hydrocarbons and providing services for the management of E&P Blocks, manufacturing of ethanol, sugar and generation of power, operating Liquefied Natural Gas (LNG) regasification terminal, green and renewable energy business.
Incorporated in 1952, HPCL is a Government of India Enterprise with Oil and Natural Gas Corporation Limited (ONGC) holding 54.9 percent as of 31st March 2024.
Written by Shivani Singh
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