Bharat Petroleum Corporation vs TATA CONSUMER PRODUCTS Q4 FY24

BPCL reported Q4 FY24 revenue of INR 132,085 crore and PAT of INR 4,224 crore, contributing to a record full-year net profit of INR 26,674 crore. Refinery throughput hit an all-time high of 39.33 MMT, with GRM of $12.48/bbl (premium to Singapore) driven by Russian crude sourcing (39% of imports) and high diesel yield. Marketing sales grew 2.09% QoQ, with retail market share gains in petrol (29.6%) and diesel (29.8%). Management guided for INR 1.7 lakh crore capex over five years, including Bina refinery expansion to 45 MMT by FY29, 4,000 new retail outlets, and 10 GW renewable capacity by 2040. Risks include moderation of Russian crude discounts (now $3-6/bbl vs $8-10 last year) and potential volatility in product cracks.

Guidance read

Refining capacity expansion to 45 MMT by FY29: Brownfield expansion of Bina Refinery and debottlenecking of existing refineries to increase capacity from current levels to 45 MMT per annum by FY 2029. Capex of INR 1.7 lakh crore over five years (FY24-29): Planned investments include INR 75,000 crore for refineries/petchem, INR 20,000 crore for marketing, INR 25,000 crore for gas, INR 10,000 crore for green energy, and INR 32,000 crore for upstream. FY25 capex target of INR 15,000-16,000 crore: Breakdown: INR 4,200 crore for refinery/petchem, INR 7,000 crore for marketing (including CGD), and INR 2,000-2,500 crore for BPRL equity infusion. Add 4,000 new retail outlets by FY29: Plan to expand network from 22,000 to 26,000 outlets; FY25 target is 1,300 new outlets.

Risk read

Key risks include Moderation of Russian crude discounts — Discounts on Russian crude have narrowed from $8-10/bbl last year to $3-6/bbl currently, potentially compressing GRM premiums.; Volatility in product cracks — International product cracks have fallen significantly in Q4, and management noted that further moderation could impact refining margins.; Geopolitical and sanctions risk on Russian crude supply — Ongoing sanctions and payment issues cause intermittent delays in Russian crude deliveries; supply continuity is uncertain.; Brazil impairment and legal risk — INR 1,798 crore impairment on BMC-30 block in Brazil due to adverse arbitration; appeal filed but outcome uncertain..

Promise ledger

Of 2 tracked promises, management 0 met, 0 close, 2 missed.

Tata Consumer Products reported a solid Q4 FY24 with consolidated revenue up 9% YoY to INR 3,927 crore, driven by India Foods (up 20% including Capital Foods) and International Business (up 7%). EBITDA grew 22% with margin expansion of 170 bps to 15.3%, aided by international restructuring benefits and cost synergies. India Beverages volumes were flat, but coffee grew 45% in Q4. Growth businesses (NourishCo, Soulfull, Capital Foods) continued strong momentum, growing 40% for the full year. Management guided for mid-single-digit volume growth in tea and continued margin accretion from international operations. Key risks include coffee price volatility impacting US margins and delayed summer affecting NourishCo's seasonal sales. The integration of Capital Foods and Organic India is on track for 100-day completion, with EPS accretion expected by FY27.

Guidance read

Growth businesses to be 30% of India portfolio growing at 30%: With Capital Foods and Organic India, growth businesses (NourishCo, Soulfull, etc.) are expected to account for 30% of India revenue and grow at 30%. Capital Foods integration in 100 days: Capital Foods acquisition closed Feb 1, integration targeted for completion by end of April (100 days). 95% of distributors already billing. Organic India integration in 100 days: Organic India acquisition closed April 16, integration targeted for completion in 100 days. Rights issue to conclude by early Q2 FY25: The rights issue process is on track and expected to conclude by early Q2 FY25.

Risk read

Key risks include Coffee price volatility impacting US margins — Rising Robusta and Arabica prices could pressure US coffee margins if not passed through quickly. Management claims agility but risk remains.; NourishCo growth slowdown due to seasonality — NourishCo missed its INR 900-1000 crore guidance, ending at INR 825 crore, partly due to delayed summer. Size may become a growth constraint.; Tea market share loss may be understated — Management disputes Nielsen data showing 7% industry growth, claiming they haven't lost share. If competitive data confirms loss, tea volumes could remain soft.; Integration risks from multiple acquisitions — Simultaneous integration of Capital Foods and Organic India within 100 days each could strain resources and execution..

Promise ledger

Of 2 tracked promises, management 0 met, 0 close, 2 missed.