HPCL Q3 Results 2021-22

Mumbai – 31^st January 2022                                                                                     

With the recovery gaining traction, Oct-Dec 2021 quarter saw the petroleum product consumption in India echoing the pre-COVID levels. The already volatile crude oil market witnessed sharp price fluctuations with the crude prices continuing to trade at 7-year high levels at end of January 2022 due to concerns over supply and ongoing geopolitical tensions.

One of the highlights of this quarter for HPCL is commissioning and stabilization of all the units under Mumbai Refinery Expansion Project, which was completed after a very complex revamp of some of the process units and addition of new process units and facilities. Mumbai Refinery is now operating at its enhanced design capacity of 9.5 MMTPA. The project will also ensure enhanced energy efficiency, reduced carbon intensity and improved distillate yield in the refinery operations.

The market sales for the period October – December 2021 (including exports) were 10.54 MMT as compared to 10.40 MMT for the same period of previous financial year. For the first time ever, HPCL exceeded Rs. One Lakh Crore mark in the quarterly sales figure. During the period October - December 2021 the Gross Sales is Rs. 103,080 crore as compared to Rs. 77,113 crore for the same period of previous financial year. Gross sales during the period Apr-Dec 2021 is Rs. 267,699 crore as compared to Rs. 184,338 crore for the same period of previous financial year.

During April-December 2021, the domestic sales of petroleum products of HPCL was 27.2 million metric tonnes against 25.4 million metric tonnes during the corresponding period of 2020-21 registering a growth of 7%.  The sale of MS increased by 14.6%, HSD 7.1% and LPG 2.9% respectively. The overall demand of petroleum products during the period Apr-Dec 21 was around 97% of pre-pandemic demand during Apr-Dec 2019.

During the period October – December 2021, HPCL refineries processed 4.24 million metric tonnes of crude as compared to 4.0 million metric tonnes during the corresponding period of previous financial year. Gross Refinery Margin is $ 6.39 / bbl for the period October – December 2021 as against $ 1.87 / bbl for the same period in the previous year. The Gross Refinery Margins for the period April – December 2021 is $ 4.50 / bbl as against $ 2.35 / bbl during the corresponding period of previous financial year.

For the period October - December 2021, HPCL recorded a Profit after Tax (PAT) of Rs. 869 crore compared to Rs 2,355 crore for the same period last year. The profit was affected primarily due to the price fluctuations in Q3 2021 leading to inventory losses compared to inventory gains in corresponding period last year. The stabilization phase of some of the units at Mumbai Refinery after the revamp shutdown also constrained, to some extent, the full value realization of the improving GRMs. However, with the units having fully stabilised now and operating to the design capacity, the positive impact of higher refinery thruput at Mumbai Refinery is expected next quarter onwards.

For the period April - December 2021, HPCL recorded a PAT of Rs. 4,587 crore as against Rs. 7,646 crore during the corresponding period of previous financial year. The consolidated PAT was Rs. 5,276 crore for period April-December 2021 as against Rs. 7,602 crore during the corresponding period of previous year.

During 3rd quarter of 2021-22, 386 new retail outlets were commissioned taking the total number of retail outlet network to 19,602 Nos. as of December 2021. HPCL also commissioned a new POL Depot at Hissar (Haryana) along with 10km dedicated tap-off pipeline from existing Ramanmandi - Bahadurgarh Pipeline (RBPL) at Barwala, which will facilitate further optimization of logistic costs & strengthening of the supply infrastructure.

Towards meeting the growing demand of LPG in the country, HPCL has strengthened its LPG supply infrastructure with commissioning of 3 new LPG bottling plants at Rayagada in Orissa, Goalpara in Assam and Gonda in Uttar Pradesh and augmented facilities at various other LPG plants. Construction of 80,000 MT LPG Cavern at Mangalore, which is in progress, will further help in optimization of cost.

To ensure availability of alternate fuels and offering more choices to customers, CNG dispensing facilities were commissioned at 91 retail outlets during October to December 2021, taking the total number of retail outlets with CNG facilities to 900. EV charging facility has been provided at 655 outlets as of December 2021 and we plan to extend it to 5,000 retail outlets in next 3-4 years.

After just concluded 11^th CGD bidding round, HPCL along with its JVs now have City Gas Distribution authorization for 21 Geographical areas covering 38 districts in 9 states. HPCL intends to invest around Rs. 9,600 crore on development of the CGD network in these geographical areas in next few years. Construction activities at HPCL’s 5 MMTPA capacity LNG Regasification terminal at Chhara, Gujarat which is being executed under its wholly owned subsidiary named “HPCL LNG Ltd” is in full swing.

State of the Art HPCL’s R&D Centre at Bengaluru has received 116 patents for developing new products and technologies in a short period of 5 years since its commissioning in 2016.

HPCL is committed to conduct business with an objective of preserving the environment and contributing to sustainable development. In this context, HPCL is in the process of developing a validated roadmap with the help of a world-renowned consultant to achieve net zero Scope 1 & 2 emissions by 2040, the details of which will be released in due course of time within this calendar year itself.

HPCL is the first Oil and Gas company in India to place an order for electrolyzer based green hydrogen plant of 370 Ton per annum capacity for its Visakh Refinery which is likely to be commissioned by Dec 2022. HPCL has plans to have Green hydrogen capacity of around 24,000 Ton per annum over a period of time. HPCL is also constructing a 100 KL per day capacity 2G Bio ethanol refinery at Bhatinda with agri-waste as a feedstock and a 14 Ton per day capacity Compressed Bio-Gas plant at Badaun in Uttar Pradesh. In addition, HPCL also owns and operates two ethanol plants in Bihar through its subsidiary company. HPCL has 101 MW capacity wind farms in Rajasthan and Maharashtra and 48.80 MW solar power capacity.

The Visakh refinery upgradation and expansion project is in advance stage. Residue Upgradation Facility (RUF), which will enable substantial improvement in refinery complexity and the GRMs of Visakh Refinery, is under construction. An important milestone for Residue Upgradation Facility was fabrication, transportation and erection of world’s heaviest DAO LC Max Reactor along with 2 other LC Max reactors which was completed during the Quarter. Construction at Rajasthan Refinery and Petrochemical complex is in full swing.

HPCL’s major pipeline projects - (i) Extension of Visakh Vijaywada Secunderabad pipeline (VVSPL) from Vijayawada to Dharmapuri (VDPL) Pipeline and construction of Marketing Terminal at Dharmapuri (ii) Hassan-Cherlapalli LPG Pipeline (iii) Mundra Delhi Pipeline (MDPL) Capacity Expansion & Palanpur Vadodara Pipeline (PVPL) Extension, Barmer Palanpur Pipeline are progressing ahead of schedule.

 

Expanding its footprints in non-fuel retailing, HPCL has recently opened two more convenience stores under its brand “HaPpyShop” at Bandra West in Mumbai and Millennium Outlet Visakhapatnam. HPCL had launched its first “HaPpyShop” convenience store in Nepean Sea Road, Mumbai in Sept 2021. Product range in each of the new stores has been meticulously planned to suit the tastes and preferences of the local neighborhoods. Customers also have the choice of online shopping with door delivery on “HP Pay App”. HPCL has also launched a pure online convenience store under the same brand HaPpyShop at Madurai.

 

HPCL has been conferred with many awards during the quarter in various areas of its business, which includes the coveted 'Oil Marketing Company of the Year' Award at FIPI Oil & Gas Industry Awards, 2021, recognizing our Performance Excellence in Oil & Gas Marketing.