Bonus alert: HPCL announces 1:2 bonus issue; records Rs 16k profit in FY24

New Delhi: Hindustan Petroleum Corporation Ltd (HPCL) on Thursday reported a 25 per cent fall in its March quarter net profit on lower refining margins and announced one free bonus share for every two shares held.

Its consolidated net profit of Rs 2,709.31 crore in January-March - the fourth quarter of the 2023-24 fiscal year - compares to Rs 3,608.32 crore in the same period of the previous financial year, according to a company's stock exchange filing.

The firm earned USD 6.95 on turning every barrel of crude oil into fuel in the quarter against USD 14.01 per barrel gross refining margin a year back and USD 8.50 per barrel margin in the preceding quarter.

Its net profit was also lower because of the Rs 2 per litre cut in petrol and diesel prices. HPCL and two other state fuel retailers were affected in March ahead of the announcement of general elections. The reduction came just as international oil prices climbed, leading to a drop in marketing margins.

The firm's pre-tax profit from downstream petroleum dropped 22 per cent in the quarter.

HPCL board also approved a 1:2 bonus issue - 1 free share for every 2 shares held.

Turnover was higher at Rs 1.22 lakh crore when compared to Rs 1.15 lakh crore in January-March 2023.

For the full 2023-24, HPCL reported a record net profit of Rs 16,014.61 crore as opposed to a loss of Rs 6,980.23 crore in the previous year.

The annual profit benefited from the nearly two-year-long freeze in petrol and diesel prices. While the freeze was affected when crude oil (the input used for making fuels like petrol and diesel) started rising in 2022 post-Russia's invasion of Ukraine, international rates moderated in most of 2023, helping companies like IOC book handsome profits.

It was only in mid-March that petrol and diesel prices were cut by Rs 2. The rate cut, which came just before the general elections, happened when crude oil prices started inching up.

For FY2023-24, the revenue from operations stood at Rs 4,61,638 crore (Rs 4,66,192 crore during the previous year).

The average gross refining margin (GRM) for 2023-24 (April 2023 to March 2024 fiscal) was USD 9.08 per barrel as opposed to USD 12.09 per barrel during the previous financial year.

"The reduction in GRMs is in line with the trend of international product cracks," the company said in a statement.

The Board of Directors has recommended the issue of bonus shares in the ratio 1:2 - one new bonus equity share of Rs 10 each for every two existing equity shares of Rs 10 each fully paid up, subject to the approval of shareholders.

The board also recommended a final dividend of Rs 16.50 per equity share having a face value of Rs 10 (pre-bonus), which translates into a final dividend of Rs 11.00 per equity share with a face value of Rs 10 (post-bonus) for 2023-24.

The final dividend is in addition to the interim dividend (pre-bonus) paid for FY 2023-24 at Rs 15 per equity share.

HPCL refineries processed the highest ever crude thru-put of 22.33 million tonnes during the year operating at 103.3 per cent of the installed capacity, registering an increase of 17 per cent over crude thru-put of 19.09 million tonnes processed during FY 2022-23.

Visakh refinery has recorded the highest-ever crude thru-put of 12.69 million tonnes during the year, with diesel production of 5.7 million tonnes surpassing the previous highest diesel production by more than 30 per cent.

On the marketing front, HPCL achieved the highest-ever total sales volume of 46.82 million tonnes (including exports) during 2023-24, registering a growth of 7.8 per cent over the previous year.

HPCL registered the highest-ever petrol and diesel sales.

"To strengthen its refining and marketing infrastructure, HPCL has invested Rs 14,342 crore during the year (including equity investment in its joint ventures and subsidiaries)," the statement said.

With the commissioning of 428 petrol pumps during the January-March quarter, HPCL achieved the milestone of 22,000+ retail outlets, and the total number of outlets now stands at 22,022 as of March 31, 2024.

Electric vehicle (EV) charging facilities were commissioned at 1,201 retail outlets, taking the total number of outlets with EV charging facilities to 3,603 as of March 31, 2024.