Oil marketing companies (OMC) plan to revise petrol and diesel prices daily in five cities from May 1 and going forward a nationwide rollout is expected. Also in five states, on Sundays, petrol pumps will be closed.
In an interview to CNBC-TV18, P Balasubramanian, Director-Finance at Bharat Petroleum Corporation Ltd (BPCL) spoke about the latest happenings in his company and sector.
We will review closure of petrol pumps on Sundays after a few days, he said. Also, he does not see any hit on profits even if petrol pumps are closed on Sunday.
“Profitability will not be the issue. Issue is the supply chain and distribution part of it”, he said.
Below is the verbatim transcript of the interview.
Anuj: First I want to discuss petrol pumps being closed on Sunday. Is this feasible, I believe Maharashtra is one of the states?
A: I think some of the associations have given that thing. We are in dialogues with these associations. We will see how that needs to be sorted out.
Anuj: If it happens, it will lead to quite a bit of dent on profitability I assume?
A: Profitability will not be the issue. Issue is the supply side part of it and the distribution part of it.
Latha: You will end up selling the same amount of volume even with four days off?
A: That is right.
Latha: Volumes itself, I mean for three months in a row we have seen the volume of fuel products consumption falling. Is that now a worry, how would you think that you would do the quarter?
A: Petrol has done well. There are no issues on the petrol side. Diesel has been slightly lower. I think the pickup should start from now on and I think in the second half it should be moving up. Overall the diesel growth for the oil marketing companies have been negative in the current year though the last quarter the negatives were a little bit more.
However, I feel that once this year close thing comes, and then now the market is getting slowly revived, I think the diesel growth also should go in-line with the normal industry growth which we used to have at 2-3 percent. However, petrol has been very buoyant at almost around 9 percent growth in the current year.