Hold Hindustan Petroleum Corporation; target of Rs 373 Prabhudas Lilladher

Prabhudas Lilladher recommended hold rating on Hindustan Petroleum Corporation with a target price of Rs 373 in its research report dated January 24, 2024.

Broker Research

January 27, 2025 / 12:08 IST

Hold

26 Aug, 2025 12:21

Volume

Todays L/H

Prabhudas Lilladher's research report on Hindustan Petroleum Corporation

Hindustan Petroleum Corporation (HPCL) reported better-than-expected Q3 results with EBITDA of Rs59.7bn (up 119.1% QoQ; PLe: Rs54.1bn, BBGe:Rs60bn) and PAT of Rs30.2bn (up 4.8x QoQ; PLe: Rs26.5bn, BBGe: Rs31.8bn). On the refining front, GRM came in at US$6/bbl. GMM stood at Rs5.7/ltr, and underrecovery on sale of LPG stood at Rs31bn. The stock is trading at 1.3/1.1x FY26/27 P/BV. In Q4-TD, Singapore GRM has softened, averaging below US$2.5/bbl, amid decline in product cracks. Marketing margins on petrol/ diesel too have moderated to Rs10.9/6.6/ltr. We believe GRMs will rebound to the long-term average of US$5-7/bbl in FY26/27 and build in a GRM of US$4.8/6/6/bbl for FY25/26/27E.

Outlook

On the marketing front, we build in a GMM of Rs3.9/4.5/4.5/ltr for FY25/26/27E. We maintain HOLD rating with a TP of Rs373 based on 1.2x FY27 P/BV.

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