• OUTLOOK ARENA
  • VIEWS ON NEWS
  • AUGUST 5, 2000

BRPL in the doldrums

Although, Bongaigon Refinery & Petrochemicals Ltd. (BRPL) has reported a respectable growth in turnover its operating margins have gone for a toss. The tough conditions prevailing in the previous fiscal have continued in 1QFY01. In fact, for BRPL the situation seems to have become worse with OPM's declining sharply.

The quarter ended June'00 witnessed firm crude prices with increased volatility. The increase in feedstock prices was not correspondingly matched by an increase in product prices. This led to the sharp drop in margins.

The current industry environment has impacted BRPL more than the oil majors (BPCL, HPCL and IOC). This is because BRPL is a stand alone refinery and its fortunes are entirely dependent on the refining margin cycle. On the other hand the oil majors have marketing rights of controlled products. This function generates additional operating margins, which provides a buffer to the bottomline in case refining margins are hit.

It is imperative that the Government hastens the process of industry deregulation and decides on the fate of the stand-alone refineries and marketing companies. Government apathy towards oil companies has seen their results being adversely impacted. With opening up of the industry to competition the margins will be further impacted and stand alones will not be able to hold their stead.

(Rs m) 1QFY00 1QFY01 Change
Sales 2,395 2,814 17.5%
Other Income 44 39 -10.8%
Expenditure 2,430 3,005 23.7%
Operating Profit (EBDIT) (35) (191) 450.7%
Operating Profit Margin (%) -1.4% -6.8%  
Interest 27 33 19.0%
Depreciation 73 72 -0.8%
Profit before Tax (91) (257) 182.3%
Tax - -  
Profit after Tax/(Loss) (91) (257) 182.3%
Net profit margin (%) -3.8% -9.1%  
No. of Shares (eoy) 200 200  
Earnings per share* -1.8 -5.1  
(annualised)      

Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (Research Analyst) bearing Registration No. INH000000537 (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA, Canada or the European Union countries, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

Equitymaster Agora Research Private Limited (Research Analyst)
103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407