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Informist, Friday, Aug.8, 2025

By Sunil Raghu

AHMEDABAD – Better gross marketing margins on retail fuels such as petrol and diesel are expected to aid the net profit of state-owned Bharat Petroleum Corp. Ltd. for the June quarter. On the other hand, muted refining output due to a maintenance shutdown at its Mumbai refinery and a decline in year-on-year gross refining margins at refinery level may weigh on revenue, analysts said.

The average of estimates by 11 brokerages pegs Bharat Petroleum Corp. Ltd.'s net profit for the June quarter at INR 62 billion, more than double the year-ago period, aided by firm fuel marketing margins. The estimates for net profit range from a high of INR 75.5 billion by Kotak Institutional Equities to a low of INR 41.3 billion by Nirmal Bang Equities Pvt. Ltd.

BPCL's revenue is expected to fall 10.5% on year to INR 1.01 trillion during the June quarter, largely due to lower crude oil prices and reduced refining throughput. Revenue forecasts range from INR 1.11 trillion by Dolat Capital Market Pvt. Ltd. to INR 909.3 billion by Motilal Oswal Financial Services Ltd.

In the March quarter, BPCL had posted a net profit of INR 32.1 billion on revenue of INR 1.11 trillion. In the year-ago June quarter, its net profit came in at INR 30.1 billion on revenue of INR 1.13 trillion. The company is set to announce its June quarter earnings on Aug. 13.

The 11 brokerages polled estimate BPCL's earnings before interest, tax, depreciation and amortisation for the June quarter to be around INR 102 billion. BPCL's gross refining margin is expected to be in the range of $6.5–$8 per barrel for the June quarter. This is lower than the $9 per barrel reported in the March quarter. Gross refining margin reflects the difference between the cost of crude oil and the value of refined petroleum products. It is a key indicator of a refinery's operational efficiency and a key profitability metric for refiners. Most of the analysts polled forecast BPCL's GRM for June quarter to be around $9 per barrel.

The analysts polled also see BPCL's marketing volume in the June quarter around 14 million tonnes, blended marketing margins of about INR 10 per litre and pump margins between INR 7.3-8 per litre. Nirmal Bang Equities Pvt. Ltd. says BPCL will "steal the show" in June quarter with its net profit growth but high base last year and inventory loss may weigh on the company's earnings. Prabhudas Lilladher Pvt. Ltd., on the other hand, asks investors to "reduce" holdings in BPCL. It cites firm global oil prices, falling GRMs and high LPG under-recoveries for its view. Nuvama Wealth Management Ltd. expects BPCL's June quarter throughput to remain flat on year due to a maintenance shutdown at Mumbai refinery.

Looking ahead, analysts are keen to hear BPCL management's updates on the company's expansion projects, particularly the INR-500-billion Bina refinery expansion and the construction timeline for the proposed 9-million-tonne Andhra green field refinery. They will also watch progress on the INR-600-billion petrochemicals complex planned alongside the Andhra refinery. They will want to know whether the project remains on track to become operational in 2027-28 (Apr–Mar).

At 1148 IST, the shares of BPCL traded at INR 318.60 per share on the National Stock Exchange, up 2.7% for the day and up nearly 2% from INR 311.70 on Apr. 29, 2025, the day BPCL announced its March quarter earnings.

Of the 14 research reports on the company available with Informist, nine brokerages have a "buy" or equivalent rating, with average target price of INR 380 per share. Four analysts have "sell" rating with average target price of INR 271 per share, while the remaining one has a "hold" call for the stock.

Following are the Apr-Jun earnings estimates for BPCL based on reports from 11 brokerage firms in descending order by the estimate of net profit:

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US$1 = INR 87.62

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

Edited by Deepshikha Bhardwaj

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