CMP Rs385, Target Rs400, Upside 3.9%
• HPCL reported a net sales growth of 39.6% yoy in Q1 FY12 primarily on back of 11.7% increase in sale volumes and higher realizations (in line with crude oil price movement and price hikes implemented by the government).
• Throughput was higher at 4mn tons v/s 3.9mn tons in Q1 FY11 as both refineries operated for the full quarter.
• Quarterly GRMs were at US$1.2/bbl v/s US$3.22/bbl despite strong global trends owing to inventory losses on the raw material front.
• Gross under recoveries were at Rs95bn as compared to Rs44bn in Q1 FY11. Rs31.7bn was borne by upstream (Rs14.7bn in Q1 FY11), while government contributed Rs32.7bn (as against nil in Q1 FY11).
• HPCL reported a loss of Rs30.8bn v/s loss of Rs18.8bn in Q1 FY11 primarily on back of higher net under recoveries, poor refining performance, 34% jump in interest costs and 15.5% lower other income.
• Maintain Market Performer rating as we feel the upsides from the recent regulatory moves are priced in. We revise our 9-month target price to Rs400
(Rs mn) Q1 FY12 Q1 FY11 % yoy Q4 FY11 % qoq
Net sales 409,169 293,015 39.6 398,922 2.6
Material costs (147,057) (97,951) 50.1 (109,845) 33.9
Purchases (271,150) (197,416) 37.3 (241,210) 12.4
Personnel costs (5,395) (3,662) 47.3 (7,860) (31.4)
Other overheads (11,251) (9,325) 20.7 (18,002) (37.5)
Operating profit (25,684) (15,339) 67.4 22,005 -
OPM (%) (6.3) (5.2) (104) bps 5.5 (1,179) bps
Depreciation (3,886) (3,174) 22.4 (4,015) (3.2)
Interest (2,641) (1,968) 34.2 (2,255) 17.1
Other income 1,397 1,653 (15.5) 1,911 (26.9)
PBT (30,815) (18,829) 63.7 17,645 -
Tax - - - (6,282) -
Effective tax rate (%) - - 35.6
Adjusted PAT (30,815) (18,829) 63.7 11,363 -
Adj. PAT margin (%) (7.5) (6.4) (111) bps 2.8 (1,038) bps
Extra ordinary items 12 (14) - (137) -
Reported PAT (30,803) (18,843) 63.5 11,227 -
Source: Company, India Infoline Research
Financial summary
Y/e 31 Mar (Rs m) FY10 FY11 FY12E FY13E
Revenues 1,076,375 1,341,199 1,489,813 1,660,769
yoy growth (%) (13.7) 24.6 11.1 11.5
Operating profit 25,432 39,298 44,307 45,197
OPM (%) 2.4 2.9 3.0 2.7
Reported PAT 13,014 15,543 16,850 17,464
yoy growth (%) 126.3 18.3 9.5 3.6
EPS (Rs) 38.4 45.8 49.7 51.5
P/E (x) 10.0 8.4 7.7 7.5
Price/Book (x) 1.1 1.0 0.9 0.9
EV/EBITDA (x) 13.4 9.7 8.1 7.7
Debt/Equity (x) 1.8 2.0 1.8 1.6
RoE (%) 11.7 12.9 12.8 12.0
RoCE (%) 8.7 8.6 9.1 9.0
Source: Company, India Infoline Research
• HPCL reported a net sales growth of 39.6% yoy in Q1 FY12 primarily on back of 11.7% increase in sale volumes and higher realizations (in line with crude oil price movement and price hikes implemented by the government).
• Throughput was higher at 4mn tons v/s 3.9mn tons in Q1 FY11 as both refineries operated for the full quarter.
• Quarterly GRMs were at US$1.2/bbl v/s US$3.22/bbl despite strong global trends owing to inventory losses on the raw material front.
• Gross under recoveries were at Rs95bn as compared to Rs44bn in Q1 FY11. Rs31.7bn was borne by upstream (Rs14.7bn in Q1 FY11), while government contributed Rs32.7bn (as against nil in Q1 FY11).
• HPCL reported a loss of Rs30.8bn v/s loss of Rs18.8bn in Q1 FY11 primarily on back of higher net under recoveries, poor refining performance, 34% jump in interest costs and 15.5% lower other income.
• Maintain Market Performer rating as we feel the upsides from the recent regulatory moves are priced in. We revise our 9-month target price to Rs400
(Rs mn) Q1 FY12 Q1 FY11 % yoy Q4 FY11 % qoq
Net sales 409,169 293,015 39.6 398,922 2.6
Material costs (147,057) (97,951) 50.1 (109,845) 33.9
Purchases (271,150) (197,416) 37.3 (241,210) 12.4
Personnel costs (5,395) (3,662) 47.3 (7,860) (31.4)
Other overheads (11,251) (9,325) 20.7 (18,002) (37.5)
Operating profit (25,684) (15,339) 67.4 22,005 -
OPM (%) (6.3) (5.2) (104) bps 5.5 (1,179) bps
Depreciation (3,886) (3,174) 22.4 (4,015) (3.2)
Interest (2,641) (1,968) 34.2 (2,255) 17.1
Other income 1,397 1,653 (15.5) 1,911 (26.9)
PBT (30,815) (18,829) 63.7 17,645 -
Tax - - - (6,282) -
Effective tax rate (%) - - 35.6
Adjusted PAT (30,815) (18,829) 63.7 11,363 -
Adj. PAT margin (%) (7.5) (6.4) (111) bps 2.8 (1,038) bps
Extra ordinary items 12 (14) - (137) -
Reported PAT (30,803) (18,843) 63.5 11,227 -
Source: Company, India Infoline Research
Financial summary
Y/e 31 Mar (Rs m) FY10 FY11 FY12E FY13E
Revenues 1,076,375 1,341,199 1,489,813 1,660,769
yoy growth (%) (13.7) 24.6 11.1 11.5
Operating profit 25,432 39,298 44,307 45,197
OPM (%) 2.4 2.9 3.0 2.7
Reported PAT 13,014 15,543 16,850 17,464
yoy growth (%) 126.3 18.3 9.5 3.6
EPS (Rs) 38.4 45.8 49.7 51.5
P/E (x) 10.0 8.4 7.7 7.5
Price/Book (x) 1.1 1.0 0.9 0.9
EV/EBITDA (x) 13.4 9.7 8.1 7.7
Debt/Equity (x) 1.8 2.0 1.8 1.6
RoE (%) 11.7 12.9 12.8 12.0
RoCE (%) 8.7 8.6 9.1 9.0
Source: Company, India Infoline Research
Posts
0 comments:
Post a Comment