HPCL on Friday reported a 49.2 per cent drop in net profit for the April-June quarter on a sequential basis but its shares still surged by 8.65 per cent on higher-than-expected gross refining margin (GRM).
Positive market sentiments about the petroleum sector also added to the stock rally.
State-owned refiner earned profit of Rs 925 crore during April-June compared with Rs 1819 crore in previous quarter.
Revenue increased 2 per cent to Rs 59,975 crore in June quarter compared with Rs 58,779 crore in March quarter of FY17.
Gross refining margin (GRM) during the quarter stood at $ 5.86 a barrel, which was ahead of analysts estimates of $4.9 a barrel. GRM for January-March 2017 stood at $ 8 a barrel.
Operating profit fell sharply by 43.6 per cent sequentially to Rs 1,628 crore and margin contracted by 256 basis points to 3.04 percent in the quarter ended June 2017.
Bottomline and operational numbers missed analysts’ expectations but topline was ahead of estimates.
Profit was estimated at Rs 1,029 crore on revenue of Rs 46,520 crore and operating income was expected at Rs 1,928 crore with margin at 4.1 percent for the quarter, according to average of estimates of analysts.