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Informist, Tuesday, May 12, 2026

By Shruti Nair

MUMBAI – Hindustan Petroleum Corp. Ltd. is expected to report a sharp year-on-year decline in its net profit for the March quarter due to a steep fall in its marketing margins, according to analysts tracking the company. This is despite expectations of double-digit year-on-year growth in the company's top line.

The state-owned oil marketing company's net profit for the March quarter is expected to fall by over 46% year-on-year to INR 17.99 billion, according to the average of estimates from 10 brokerages. The highest estimate for the company's bottom line is INR 36.88 billion from JM Financial Institutional Securities Pvt. Ltd., which factors in a sequential rise in the company's gross refining margins due to higher diesel crack spreads. The lowest estimate is a meagre INR 32 million from Emkay Global Financial Services Ltd. The bottom line is expected to decline nearly 56% sequentially.

The company's revenue for the March quarter is expected to rise nearly 21% year-on-year to INR 1.32 trillion, according to the average of brokerage estimates. While Emkay Global Financial Securities has the highest estimate for the company's top line at INR 1.48 trillion, the lowest estimate is INR 1.14 trillion from Motilal Oswal Financial Services Ltd., which assumes a 7% on-year decline in the company's refining throughput for the March quarter to 6.3 million tonnes. Sequentially, the oil refiner's top line is expected to rise nearly 15%.

Most brokerages estimate the oil marketing company's refining margins to rise. Refining margins, a key profitability metric for oil refiners, represent the difference between revenue from petroleum product sales and the cost of feedstock, primarily crude oil. Nomura Equity Research Ltd. expects the company's core refining margins to be $15 in the March quarter, up from $8.9 in December, due to supply disruptions from refinery shutdowns in West Asia.

However, most brokerages expect gains in the company's refining margins to be offset by a sharp decline in marketing margins due to the crisis in West Asia, higher LPG under-recoveries, and the government's refusal to allow oil marketing companies to raise retail fuel prices. Marketing margins are the profits earned by oil refiners from the retail distribution of refined products after accounting for input expenses, including landed costs. Prabhudas Lilladher expects marketing margins of INR 0.4 per litre on sales volume of 13.4 million tonnes for the March quarter, against INR 5.4 per litre on sales volume of 13.3 million tonnes in the December quarter.

The company's earnings before interest, taxes, depreciation, and amortisation are pegged at INR 38.74 billion for the March quarter, according to the average of estimates from nine brokerages. Estimates for EBITDA range from INR 16.00 billion from Equirus Securities Pvt. Ltd. to INR 64.37 billion from JM Financial.

For 2025-26 (Apr-Mar), Hindustan Petroleum's net profit is expected to more than double to INR 159.53 billion from INR 73.65 billion in FY25. The company's revenue during the year is expected to rise 1.5% to INR 4.40 trillion.

Hindustan Petroleum is a state-owned company that refines crude oil into petroleum products such as petrol, diesel, and LPG, and markets them. The company has major refineries in Mumbai and Visakhapatnam. The company will announce its March quarter earnings on Wednesday.

At 1342 IST, shares of Hindustan Petroleum were at INR 372.50 on the National Stock Exchange, down 1.4% from the previous close. Shares of the company have fallen about 13% since it released its December quarter earnings in January.

Of the 12 brokerage reports on the company available with Informist, 10 have a 'buy' or equivalent recommendation on the stock, with an average target price of INR 553, 48% above the current price. Two brokerages have a 'sell' or equivalent recommendation.

The following are the Jan-Mar earnings estimates for Hindustan Petroleum Corp. Ltd. from 10 brokerages in descending order of the estimate of net profit in INR billion:

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Edited by Saji George Titus

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