State-owned Bharat Petroleum Corporation Ltd (<keyword id="19908646" type="General" weightage="100" keywordseo="bpcl" source="keywords">BPCL</keyword>) on Monday reported an 82% jump in its December quarter net profit on the back of higher-than-expected refining margins and a rise in margins on fuel sales. Its consolidated net profit of Rs 3,181.42 crore in October-December - the third quarter of the current fiscal year, stated on April 1, 2023 - compares to Rs 1,747.01 crore earnings in the same period of the previous financial year, according to a company statement. Its profit was, however, lower than Rs 8,243.55 crore earnings in the preceding quarter (July-September 2023). The continuing freeze in fuel prices, which is now 21 months old, despite a fall in input raw material (crude oil) prices helped raise marketing margins. BPCL earned an estimated USD 13.3 on turning every barrel of crude oil into fuel like petrol and diesel during October-December. Pre-tax earnings from fuel marketing soared to Rs 4,372.93 crore in the third quarter from Rs 2,618.95 crore a year back but lower than the record Rs 11,283.29 crore in the July-September period. Its revenue from operations was slightly lower at Rs 1.3 lakh crore. In 2022, state-owned fuel retailers Indian Oil Corporation (IOC), BPCL and Hindustan Petroleum Corporation Ltd (HPCL) froze prices, despite a spike in global oil rates, following Russia's invasion of Ukraine. This was with a view to insulate consumers from price volatility. The price freeze led to the three firms incurring losses in the first half of the 2022-23 fiscal (April 2022 to March 2023). When prices started to fall last year, they recouped the previous year's losses, and the same continues even now. Profitability soared in the July-September quarter, but inventory losses in the subsequent three months tempered earnings. BPCL's marketing margin in October-December is estimated at Rs 3.5 per litre. The company turned 9.86 million tonnes of crude oil into fuel in the third quarter, up from 9.39 million tonnes a year back and 9.35 million tonnes in the preceding quarter. Fuel sales were almost flat at 12.92 million tonnes in October-December when compared to year-on-year, but were higher than 12.19 million tonnes in the preceding quarter. During the first nine months of the current fiscal, the company recorded its highest-ever net profit of Rs 22,069.27 crore as opposed to a loss of Rs 4,739.42 crore in April-December 2022. Gross refining margins (GRM) for the April-December period was USD 14.72 per barrel against USD 20.08 a barrel in the corresponding comparative period. EBITDA for the nine months of FY24 reached Rs 36,887.35 crore, an increase from Rs 1,253.93 crore in the first three-quarters of FY23. The EBITDA margin was 9.84% in the first nine months of FY24, compared to 0.31% in the corresponding period of FY23. EBITDA for Q3 FY24 at Rs 6,906.37 crore was higher than Rs 4,685.82 crore in Q3 FY23. BPCL expanded its retail network by adding 501 new fuel stations, bringing the total network strength to 21,532. A total of 112 CNG stations were commissioned, raising the total to 1,711 CNG stations as of December 31, 2023. BPCL chairman and managing director <keyword id="20373329" type="General" weightage="20" keywordseo="g-krishnakumar" source="keywords">G Krishnakumar</keyword> said the company "delivered another quarter of resilient performance with strong operating fundamentals amidst a challenging operating environment. Our focus remains on driving competitive volume growth and achieving operational excellence, whilst stepping up investment towards our long-term strategic priorities".

BPCL Q3 net profit jumps 82% on higher refining, market margins

State-owned <keyword id="20039950" type="General" weightage="20" keywordseo="Bharat-Petroleum-Corporation" source="keywords" meta.keywordsubtype="org" meta.entityname="Bharat Petroleum Corporation" meta.hostid="153" meta.entityid="Bharat Petroleum Corporation">Bharat Petroleum Corporation</keyword> plans to invest Rs 1.7 lakh crore over the next five years to grow its core oil refining and fuel marketing business as well as in 'future big bets' of <keyword id="20115883" type="General" weightage="20" keywordseo="petrochemicals" source="keywords">petrochemicals</keyword> and <keyword id="19895435" type="General" weightage="20" keywordseo="green-energy" source="keywords">green energy</keyword>, its chairman G Krishnakumar has said. At present, Bharat Petroleum Corporation Ltd (<keyword id="19908646" type="General" weightage="100" keywordseo="BPCL" source="keywords" meta.keywordsubtype="org" meta.entityname="BPCL" meta.hostid="153" meta.entityid="BPCL">BPCL</keyword>) owns about 14 per cent of India's oil <keyword id="20064251" type="General" weightage="20" keywordseo="refining-capacity" source="keywords">refining capacity</keyword> and about a quarter of the fuel retailing network. It plans to grow these businesses while foraying into newer areas. The firm is now implementing the first phase of a multi-decade aspirational journey in the form of '<keyword id="22826627" type="General" weightage="20" keywordseo="project-Aspire" source="keywords">Project Aspire</keyword>' - its five-year strategic framework that is based on two fundamental pillars - 'Nurturing the Core' and 'Investing in Future Big Bets', he said in the company's latest annual report. "Our mid-term strategy is on a continuum. While we remain committed to growing our core businesses, which include refining and marketing <keyword id="20037698" type="General" weightage="20" keywordseo="petroleum-products" source="keywords">petroleum products</keyword> and upstream, we are equally focused on our big bets comprising petrochemicals, gas, green energy, non-fuel retail, and digital. "Project Aspire, with a planned capex outlay of around Rs 1.70 lakh crore over five years, will enable us to create long-term value for our stakeholders while preserving our planet for future generations," he said. "A cornerstone of our long-term strategy, Project Aspire, with a Rs 1.70 trillion investment, marks the initial phase of our multi-decade odyssey to shape the energy of tomorrow. This, coupled with our robust balance sheet, fuels our ambition to lead the <keyword id="19951336" type="General" weightage="20" keywordseo="energy-transition" source="keywords">energy transition</keyword>." The company is targeting net zero carbon emissions from its operations by 2040. "BPCL has drawn a net-zero roadmap, which encompasses renewable power, green hydrogen, compressed biogas, carbon capture, utilisation, and storage (CCUS), efficiency improvement and the offsets procurements. This would require a phased capital outlay of approximately Rs 1 lakh crore till 2040, and the company is geared for the same," he said. The firm's bet on continuing investing in core businesses is based on the premise that India's booming economy will drive a 4-5 per cent annual increase in energy demand and petroleum product consumption. Also, the demand for major petrochemical products is expected to rise by 7-8 per cent annually. "This presents a strategic opportunity to expand refining capacity alongside the development of integrated petrochemical complexes," he said. BPCL is implementing new petrochemical projects at two of its three oil refineries. A Rs 49,000 crore ethylene cracker project is being implemented at the Bina refinery in Madhya Pradesh, alongside raising oil refining capacity from the current 7.8 million tonnes to 11 million tonnes annually by 2029. A polypropylene project is being set up at Kochi refinery in Kerala by 2027. "To meet the anticipated demand beyond our planned expansions in Bina and Kochi, we are actively evaluating options for setting up additional integrated refining and petrochemical capacities within the next 5-7 years," Krishnakumar said without disclosing either the investments or the location of such a project. Andhra Pradesh is being speculated as the likely site after Prime Minister Narendra Modi's BJP and regional party TDP stormed to power in the state in recently concluded assembly elections. TDP has been demanding the implementation of a refinery-cum-petrochemical complex that was promised as part of the package when the state was split more than a decade back. "Our investment in the petrochemical project is consistent with our aspiration of becoming a dominant player in India's petrochemical growth story," Krishnakumar said. On energy transition, he said BPCL is targeting to build 2 gigawatts (GW) of <keyword id="19895602" type="General" weightage="20" keywordseo="renewable-energy" source="keywords">renewable energy</keyword> capacity by 2025 and 10 GW by 2035. "We are investing nearly Rs 1,000 crore to establish two 50 MW captive wind power plants in Maharashtra and Madhya Pradesh, which will support our refineries in Mumbai and Bina." The firm is also investing around Rs 300 crore in 72 MWp of solar project in Prayagraj, Uttar Pradesh. "Concomitantly, we are executing green hydrogen projects aligned with the National Green Hydrogen Mission. These projects include a 5 MW electrolyser plant at Bina refinery and a green hydrogen refuelling station with an indigenously developed electrolyser at Kochi," he noted. BPCL, he said, is committed to supporting the transition to electric mobility through a robust and accessible charging infrastructure. The company has installed over 3,000 charging stations, including fast chargers for cars and two-wheelers. 900 fast chargers are installed across 120 highway corridors, which helps address the range, discovery and time anxiety of electric vehicle (EV) owners. "Over the next five years, we aim to install 4-wheeler fast chargers at approximately 6,000 retail outlets across 400 highway corridors, prioritising high-traffic corridors like the Golden Quadrilateral and N-S/E-W highways," he said. On biofuels, he said BPCL sells petrol with 20 per cent ethanol blend at 4,279 out of its over 22,000 petrol pumps. It is also building compressed biogas plants using municipal solid waste to make gas that can be used as CNG in automobiles. The firm is also exploring partnerships in the arena. "These combined efforts, along with the upcoming commissioning of a bio-ethanol refinery, positions BPCL as a key player in India's transition to a greener fuel mix, creating a robust ecosystem for the adoption of cleaner fuels across the country," he added. BPCL is establishing a corporate venture capital fund to invest directly in promising startups. "In order to thrive in this complex and challenging business landscape, we will leverage our agility and focus on operational excellence to ensure continued success. Safety and reliability will remain our top priorities, guiding all our actions. We are committed to upholding the highest standards of corporate governance," he added. He said the energy sector of India stands at an inflection point. "The nation has an ambitious vision of becoming a USD 30 trillion developed economy by 2047. 'Viksit Bharat @2047' will necessitate an almost fourfold increase in primary energy demand." India's exponential growth trajectory will propel it to a pivotal role in the global energy market, accounting for roughly 12 per cent of world energy consumption by 2047. "The key strategic objectives for India in the energy sector will entail significant expansion in refining capacities, raising the share of gas in the energy basket from about 6 per cent to 15 per cent, establishing leadership in petrochemical exports, and sharply reducing energy imports from current levels of 47 per cent to below 25 per cent by 2030 and to zero by 2047," he said. India is targeting 500 GW of non-fossil fuel energy capacity, sourcing half of its energy needs from renewables, reducing carbon emissions by 1 billion tonnes and lowering carbon intensity by 45 per cent by 2030 with the ultimate goal of net-zero emissions by 2070. "Building on its strong Indian energy presence, BPCL aspires to meet 7-10 per cent of the nation's primary energy demand by 2047," he said.

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BPCL Q3 net profit jumps 82% on higher refining, market margins

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BPCL planning Rs 1.7 lakh crore spend to expand core business, new energy foray over next five years

PTI