Please refer to important disclosures at the end of this report
Hindustan Petroleum Corporation Limited (HPCL) is a holding company. The
Company is engaged in the business of refining of crude oil and marketing o
petroleum products. OMCs’ balance sheet and return ratios strengthened post
the diesel deregulation as it lowered the companies’ debt and offered retail
petroleum pricing freedom. OMCs have demonstrated their pricing power b
successfully tuning retail fuel prices to pass on the impact of volatile
crude/foreign exchange. HPCL has started dynamic pricing for auto fuels, which
should help the company to sweat marketing assets better and improve the
profitability. HPCL plans capex of INR 558b over FY16-21, which includes
~INR257b for refineries, ~INR262b for marketing, and the remaining fo
renewable, R&D and JV projects. HPCL diesel deregulation will help to reduce its
working capital leading to lower interest costs which is positive for the company.
HPCL with firm refining margins, higher profits in subsidiaries, no inventory loss,
given stable crude oil prices and healthy marketing profits resulted in a good
performance and if the same continues will result in strong performance for the
company going ahead as well. The company has been maintaining a health
dividend payout of 30.29% (Current Yield at 2.96%). The company has
reported RoE of 15%+ for the last 3 years and for FY16 reported RoE of 27.96%.
Hence Buy.
CMP `427
Stock Info
Beta 1.0
Bloomberg Code
Shareholding Pattern (%)
Promoters 51.1
MF / Banks / Indian Fls 18.8
FII / NRIs / OCBs 19.7
Indian Public / Others 10.5
Abs. (%) 3m 1yr 3yr
Sensex 6.1 10.1 43.2
Hind. Petroleum 30.4 68.6 576.0
Oil & Gas
Market Cap (
cr) 43,642
52 Week High / Low 443/212
Avg. Daily Volume 1,42,020
Face Value (
BSE Sensex 25,293
Nifty 8,745
Reuters Code HPCL.BO
Vaibhav Agrawal
022 – 3935 7800 Ext: 6808
Hindustan Petroleum Corporation
Others | Oil & Gas
September 29, 2016
Hindustan Petroleum Corp. | Oil & Gas
September 29, 2016
Research Team Tel: 022 - 39357800 E-mail: [email protected] Website:
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Disclosure of Interest Statement Hindustan Petroleum Corp.
1. Financial interest of research analyst or Angel or his Associate or his relative No
2. Ownership of 1% or more of the stock by research analyst or Angel or associates or relatives No
3. Served as an officer, director or employee of the company covered under Research No
4. Broking relationship with company covered under Research No
Ratings (Based on expected returns Buy (> 15%) Accumulate (5% to 15%) Neutral (-5 to 5%)