Bharat Petroleum Corporation Limited — Q3 FY24
BPCL reported Q3 FY24 revenue of ₹1,29,976 crore and PAT of ₹3,397 crore, with nine-month PAT at ₹22,449 crore (vs loss last year).
bullish
high
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Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
67%Questions answered3Evaded / deflected12Questions audited
Answered
High priority
Details on Bina refinery expansion configuration and product slate.
Asked by Probal Sen, ICICI Securities
Management provided specific capacity increase and product list.
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Question
Just on, firstly, on the Bina Refinery and expansion, the big project that we are doing, is it possible to get a little bit more granularity on what kind of refinery configuration will we look at post the expansion? And what kind of products, if it came out of it, will actually, any sense you can give us will be helpful.
Krishnakumar G., Chairman and Managing Director
On the refinery side, we will be moving from 7.8 million metric tons to 11 million metric tons. As far as product portfolio is, we at least will produce HDPE, LLDPE, polypropylene, and then benzene, toluene, and a little bit of bitumen.
Evasive
High priority
Outlook on GRM and marketing margins, Russian crude proportion.
Asked by Probal Sen, ICICI Securities
Management gave no concrete numbers or projections for FY25.
no specific guidancevague outlook
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Question
Your thoughts on, you know, any, you know, how the margins outlook is shaping up, both on the GRM front and on the, you know, marketing front. You mentioned thankfully that the Russian crude was at roughly about 40%. Our, our understanding is that that proportion, at least from a country level, seems to have gone down. So any indications you can give on FY 2025, what we should be sort of penciling in in terms of Russian crude?
Krishnakumar G., Chairman and Managing Director
It's actually your guess is as good as mine. But we believe it's going to be stable till, unless the Red Sea situation worsens a bit. Right now, we feel there is not going to be much of a downside.
Answered
High priority
Impact of Red Sea disruptions on crude sourcing and shipping costs.
Asked by Vivekananda Subbaraman, Ambit
Management clearly stated no current impact and coverage until April.
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Question
The first one is on the Red Sea disruptions. One of your fellow PSUs, the OMC, they said that they have not been impacted by the dislocation, and they have already tied up till the first two weeks of April. What about you, sir? And secondly, on the Russian crude itself, I believe most of it is coming from the Red Sea. Are the shipments coming, and how is that impacting the, I mean, we are also reading reports on the shipping rates being much higher because of the disruptions.
Krishnakumar G., Chairman and Managing Director
Right now, we are not impacted by the Red Sea issue. We are waiting and watching. It's right until about April, we too are covered. We don't have any worries, but these things can play out, so we'll be on the watch for that.
Partial answer
High priority
Impact of Red Sea on Russian crude discounts and shipping costs.
Asked by Vivekananda Subbaraman, Ambit
Acknowledged reports but gave no quantitative detail on discount changes.
no specific discount number given
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Question
You mentioned that there's no impact on your sourcing, but what about the shipping costs and the implications as far as the discounts are concerned in sourcing crude from Russia? Is this really resulting in narrowing discounts?
V.R.K. Gupta, Director of Finance and CFO
You are right. We are also reading the same reports, but right now, the Russian cargoes are on delivered basis, so we don't have anything to worry right away. Discounts are more, more or less on a very stable, moderate number.
Answered
High priority
Russian crude usage percentage in previous and current quarter.
Asked by Puneet Gulati, HSBC
Provided specific percentages for both periods.
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Question
If you can talk about how much of Russian crude you used in the previous quarter, and what is the run rate in the current quarter?
Krishnakumar G., Chairman and Managing Director
Current usage is about 40%, and in the previous quarter also, it was around 40%-44%.
Evasive
Medium priority
Factors behind steady GRMs and any inventory gain impact in Q3.
Asked by Sabri Hazarika, Emkay Global
Declined to discuss inventory gains, gave generic answer on margins.
refused to comment on inventory gains
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Question
Your GRMs have been, like, quite steady. So just wanted to know, was there any specific factors during Q3? And was there directionally any inventory gain impact as one of your peers have reported?
Krishnakumar G., Chairman and Managing Director
See, we cannot comment on the inventory gains right now. Margins are stable, and we have been continuously working on optimization of the refinery, so these are giving us steady results.
Answered
Medium priority
Contribution and operations of Kochi petrochemical plant.
Asked by Mayank Maheshwari, Morgan Stanley
Provided specific capacity, utilization, and production figures.
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Question
On the Kochi side, can you just talk to us in terms of the contribution on the petrochemical side and the chemical side, and how has been the operations looking like now going forward?
Krishnakumar G., Chairman and Managing Director
In Kochi, we have a polypropylene derivative petchem plant with a capacity of 329 TMT per annum. The production in 2022-2023 was about 60% capacity utilization, with about 197 TMT. In Q1, it was 57 TMT, that's about 70% utilization. Q3, it was again 57 TMT, which is 70%.
Answered
High priority
Minimum threshold return ratios for capital discipline.
Asked by Sumit Arora, Helios
Quantified the threshold return range clearly.
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Question
When you said that, you know, we are going to have maintain a capital discipline, can you please help understand, you know, when you say minimum threshold return ratios, you know, if you can quantify a bit of that so, you know, we kind of get, you know, what you know, you're thinking?
Krishnakumar G., Chairman and Managing Director
We have a threshold level of approving projects which are between 12% and 15%. 12%-15%. If there is an economic case for going down, we look at it case by case basis, but otherwise the threshold levels are 12%-15%.
Answered
Medium priority
Annual run rate for staff expenses and one-off provisions.
Asked by Vikash Jain, CLSA
Explained one-off provision and provided run rate estimate.
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Question
I had a question regarding staff expenses. So last couple of quarters, it's kind of been a bit higher. So what is the annual run rate that we are looking at on this? Is there any one-off provision or something that is there?
V.R.K. Gupta, Director of Finance and CFO
Current quarter, actually, employee benefits is a little bit on the higher side, because we have taken a small hit in terms of post-retirement medical benefits. There are certain changes in the scheme. Around INR 200 crore, we have taken a hit. Otherwise, our run rate will be around INR 3,000 crore-INR 3,100 crore for full year.
Evasive
High priority
Benefit of Russian crude to GRM and impact if discounts narrow.
Asked by Yogesh Patil, Dolat Capital
Declined to quantify Russian crude benefit on GRM.
refused to quantify benefitno specific impact given
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Question
During the quarter, BPCL processed 40% Russian crude. How much this has benefited to your GRM for this quarter? And basically, we wanted to understand that if the discounts narrow going forward on the Russian crude, then the impact on the GRM.
V.R.K. Gupta, Director of Finance and CFO
We never calculate the GRM impact on the source wide crude, right? Like, you know, the market conditions compared to earlier years, the Russian crude discounts have moderated, and we hope the Russian crude supplies will continue, but at a moderated discount. So we cannot calculate separately what would be the impact on the GRMs.
Partial answer
Medium priority
Outlook on international refining capacity and petrochemical integration.
Asked by Ramesh S., Nirmal Bang Equities
Gave qualitative view but no specific numbers on capacity or insulation.
no quantitative capacity datageneric outlook
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Question
If you look at the current international refining demand and supply, what do you see in terms of capacity addition, and how much of that will go towards petrochemical integrations? To what extent will that insulate the volatility in the refining margin?
Krishnakumar G., Chairman and Managing Director
We are very, I mean, very upbeat on the Indian demand. We also feel there will be opportunities in the Western markets, where increasingly refineries are shutting down. So we feel there will be an opportunity for processed products in the West as well.
Answered
High priority
Timeline for Mozambique project and gas marketing arrangements.
Asked by Harsh Dole, IIFL Securities
Provided specific timeline and marketing volume tied up.
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Question
Assuming that, you know, the Mozambique project starts sometime in June, by what timelines can it end? And, in terms of gas marketing, what arrangements do we have?
Krishnakumar G., Chairman and Managing Director
We expect that force majeure to be lifted around July 2027. 2028 is early, when gas will start flowing in. We have done our bit of tying up for marketing of these gas. 1 million metric tons we have tied up.