ICICI Direct recommended hold rating on Bharat Petroleum Corporation with a target price of Rs 355 in its research report dated August 12, 2019.
ICICI Direct's research report on Bharat Petroleum Corporation
Bharat Petroleum Corporation (BPCL) reported Q1FY20 results that were marginally below our estimates on the operational front. Although the profitability of the refining segment disappointed due to inventory losses, marketing segment profitability was better than our estimates. Reported GRMs disappointed and were at US$2.8/bbl (our estimate: US$3.9/bbl). On account of healthy numbers from the marketing segment, EBITDA increased to Rs 2179.9 crore, above our estimate of Rs 1887.1 crore. Also, a lower tax rate led to reported PAT above estimates at Rs 1075.1 crore (our estimate: Rs 924.9 crore).
We have a HOLD recommendation on the stock with a target price of Rs 355 (based on average of P/BV multiple: Rs 370/share and P/E multiple: Rs 340/share).
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