Essar Oil is a big gainer today, up 5% at Rs.63.35, locked at the upper circuit. Volumes were huge at over 20 lakh shares today morning compared to around 3 lakh shares over past two weeks average.

The stock has hit the roof on the back of its lower losses (YoY) in Q1FY14 despite having turned around in Q4. The market is looking at the fact that it is the rupee which has played truant and pushed the company into the red. The 10% rupee depreciation during the quarter meant the company ended the quarter with a net loss at Rs.863 crore, 43% lower than Rs.1518 crore loss in Q1FY13. In Q4, the company had reported a net profit at Rs.200 crore. The company had a forex variation of around Rs 913 crore and of this, Rs.700 crore is MTM provision, which the company hopes to realize in the next quarter.

The market is enthused by the fact that its GRM for the quarter came in at US$ 7/barrel v/s $4.69/barrel on YoY and this GRM is better than the international energy agency (IEA) benchmark based on oil methodology. It hopes to maintain at these levels for the current fiscal.