The third largest Oil Marketing Company (OMC) of India posted a 56% (YoY)  and 49% (QoQ) drop in net profit at Rs.925 crore for Q1FY18. This was on account of a 21% (YoY) increase in expenses at Rs.59,157 crore and higher inventory losses.

Revenue from operations rose 17% (YoY) and up 2% (QoQ) at Rs.60,545 crore and this was on refinery throughput increasing marginally by 0.22% (YoY) to 4.49 Million Tonnes (MMT). Its domestic sales went up marginally by 3.48% (YoY) to 9.20 mmt and exports rose from 0.03 mmt to 0.06 mmt.

HPCL’s gross refinery margins (GRM) for the quarter stood at $5.86/barrel v/s $6.83/barrel (YoY) and down sharply from $8/barrel in March’17 quarter.

Despite the dismal Q1 show, the stock went on to hit a record high on Friday on reports that the Govt will end subsidy on kerosene. The Govt has asked these OMCs to increase price on subsidized kerosene by 25 paise every 15 days till al subsidy is extinguished. In the beginning of last week, the Govt directed OMCs to hike LPG prices by Rs.4/cylinder every month.