Hindustan Petroleum Corporation Ltd (HPCL) on Thursday reported a 25 per cent fall in its March quarter net profit on lower refining margins and announced one free bonus share for every two shares held.
Its consolidated net profit of Rs 2,709.31 crore in January-March - the fourth quarter of the 2023-24 fiscal year - compares to Rs 3,608.32 crore in the same period of the previous financial year, according to a company’s stock exchange filing.
The firm earned USD 6.95 on turning every barrel of crude oil into fuel in the quarter against USD 14.01 per barrel gross refining margin a year back and USD 8.50 per barrel margin in the preceding quarter.
Its net profit was also lower because of the Rs 2 per litre cut in petrol and diesel prices. HPCL and two other state fuel retailers were affected in March ahead of the announcement of general elections. The reduction came just as international oil prices climbed, leading to a drop in marketing margins.
The firm’s pre-tax profit from downstream petroleum dropped 22 per cent in the quarter.
HPCL board also approved a 1:2 bonus issue - 1 free share for every 2 shares held.
Turnover was higher at Rs 1.22 lakh crore when compared to Rs 1.15 lakh crore in January-March 2023.
For the full 2023-24, HPCL reported a record net profit of Rs 16,014.61 crore as opposed to a loss of Rs 6,980.23 crore in the previous year.
The annual profit benefited from the nearly two-year-long freeze in petrol and diesel prices. While the freeze was affected when crude oil (the input used for making fuels like petrol and diesel) started rising in 2022 post-Russia’s invasion of Ukraine, international rates moderated in most of 2023, helping companies like IOC book handsome profits.
It was only in mid-March that petrol and diesel prices were cut by Rs 2. The rate cut, which came just before the general elections, happened when crude oil prices started inching up.
For FY2023-24, the revenue from operations stood at Rs 4,61,638 crore (Rs 4,66,192 crore during the previous year).
The average gross refining margin (GRM) for 2023-24 (April 2023 to March 2024 fiscal) was USD 9.08 per barrel as opposed to USD 12.09 per barrel during the previous financial year.
“The reduction in GRMs is in line with the trend of international product cracks,” the company said in a statement.
The Board of Directors has recommended the issue of bonus shares in the ratio 1:2 - one new bonus equity share of Rs 10 each for every two existing equity shares of Rs 10 each fully paid up, subject to the approval of shareholders.
