Bharat Petroleum Corporation vs Maruti Q1 FY24

BPCL reported a stellar Q1 FY24 with consolidated PAT of INR 10,644 crore, its highest ever, driven by record refinery throughput at 115% capacity utilization and strong marketing volume growth of ~8% YoY. Refinery GRM stood at $12.64/bbl, down sequentially due to weaker cracks, but Russian crude discounts provided a tailwind. Marketing margins improved as LPG under-recoveries were fully recouped. Management guided for INR 10,000 crore capex in FY24, with a larger INR 1.5 lakh crore five-year plan focused on petchem expansion at Bina (2.2 MTPA by 2028) and energy transition. A rights issue of INR 18,000 crore was approved to fund net-zero and energy security goals. Key risk: crude price volatility and potential narrowing of Russian crude discounts could pressure refining margins.

Guidance read

Capex target of INR 10,000 crore for FY24: Management expects to spend INR 10,000 crore in capital expenditure during FY24, with INR 1,464 crore spent in Q1. Add 1,000 new retail outlets in FY24: BPCL plans to add approximately 1,000 new retail outlets during FY24; 111 were added in Q1. Add 500 CNG stations by FY24 end: BPCL aims to add another 500 CNG stations at existing retail outlets by the end of FY24. Petchem complex at Bina by 2028: A large petrochemical complex with 2.2 MTPA capacity and refinery expansion to 11 MMTPA is planned, with commissioning by 2028.

Risk read

Key risks include Crude price volatility and Russian discount narrowing — Management noted that crude prices have risen to $82-83/bbl and Russian crude discounts have narrowed sequentially, which could pressure refining margins.; Payment issues for Russian crude above price cap — Management acknowledged that if Russian crude prices cross $60/bbl, payment issues may arise, though more banks are now willing to settle.; Delays in Mozambique LNG project — The Mozambique LNG project remains under force majeure; management expects work to restart in 1-2 quarters but cost overruns are likely.; Dividend payout sustainability amid large capex — Analyst questioned whether elevated capex plans (INR 1.5 lakh crore over 5 years) could impact dividend payouts; management reaffirmed 30% payout policy..

Promise ledger

Scorecard data is being built as historical quarters are processed.

Maruti Suzuki reported a strong Q1 FY24 with revenue of INR 30,845 crore (+22% YoY) and PAT of INR 2,485 crore (+145% YoY), driven by higher volumes, improved realization, and cost reduction. Domestic sales grew 9.1% to 434,812 units, while exports declined. The company launched three SUVs (Fronx, Jimny, Invicto) and achieved a 20% SUV market share. CNG penetration hit a record 27% with 113,000 units sold. Management announced plans to acquire Suzuki Motor Gujarat (SMG) to integrate production and target 4 million units annual capacity by 2030-31. Pending orders stood at 355,000 vehicles. Risks include ongoing semiconductor shortages (28,000 units lost in Q1) and potential demand slowdown in small cars.

Guidance read

Acquire SMG by March 2024: Board approved acquisition of Suzuki Motor Gujarat shares from SMC, to be completed within FY24 at net book value. Target 4 million units capacity by 2030-31: Production capacity to double from current levels, with 1 million capacity at Kharkhoda and additional 1 million under study. EV launch in next financial year: EV manufacturing facility at SMG will be part of MSIL; launch expected in FY25.

Risk read

Key risks include Semiconductor shortage persists — Electronic component shortages caused 28,000 units of lost production in Q1; limited visibility on supplies.; Small car segment slowdown — Small car share declined to 32% of industry; first-time buyer ratio fell to 40% from 42-44%.; Discounts and inventory pressure — Discounts increased to INR 16,214 per vehicle from INR 12,748 YoY; dealer inventory at 125,000 units (~4 weeks)..

Promise ledger

Scorecard data is being built as historical quarters are processed.