InvestorQ : How did HPCL double its profits in a difficult quarter?
diksha shah made post

How did HPCL double its profits in a difficult quarter?

Answer
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Mary Joseph answered.
2 months ago


You are right that HPCL more than doubled its net profits for the Jun-20 quarter to Rs.2253 crore on a YOY basis. Interestingly, the total sales revenues of HPCL for the Jun-20 quarter was down 40% at Rs.45,945 crore. The fall in revenues was driven by lower crude prices and as well as the prolonged shutdown of petrol stations across most parts of India.

How did HPCL achieve this when earnings per barrel fell sharply from $0.75 to just $0.04? The answer lies in the profit boost from the sequential increase in crude oil prices on a QOQ basis which led to positive revaluation of inventory. HPCL is expecting a recovery in top line sales in the September quarter, which could be a better benchmark to compare.