We Need To Balance Consumer Comfort, Government Budget And HPCL’s Financials: MK Surana

We Need To Balance Consumer Comfort, Government Budget And HPCL’s Financials: MK Surana

In an interview with ET Now, MK Surana, CMD, HPCL, says in MS and HDS price, the long -term view and the international prices are taken into account while adjusting the prices on a regular basis.

Edited excerpts:

The analyst community is a little worried that there is a lot of pressure on your marketing margins as you have not been able to hike prices entirely in tandem with oil prices. Could you confirm that for us?
Earlier also, I have said that the actual oil prices in India is a function of three things. One thing is what the international crude prices are, the product prices and the exchange rate is, the cracks on the products and the international prices in the market. We also need to balance the consumer comfort, the government budget and the company’s financials. It totals the way the prices are moving, while directionally and principally moving in line with the international prices. To some extent, we also need to be cautious and sensitive to the consumers’ convenience on the same.

Can you walk us through your blended margins and blended marketing margins where they currently are versus where they were let us say three months back?
No, it will be incorrect to keep on calculating the blended marketing margins on a day-to-day basis because what you people may be doing is that the actual selling price minus the crude prices or the refinery transport prices and that is the marketing margin. Then there is a marketing expenses, etc, taxation and the deals margin. As far as the oil companies are concerned, if your concern is for the health of marketing companies, as far as LPG and kerosene are concerned, they are controlled products and under recoveries are reimbursed by the government. To that extent, it does not affect the health of the organisations whether the under recoveries are fully passed on or not passed on at all. As far as MS, HSD and other products are concerned, they are decontrolled products and the companies seeing the long -term view and the international prices, keep on adjusting the prices on regular basis. Read More…

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