26 May 2017
4QFY17 Results Update | Sector:Oil & Gas
HPCL
Buy
BSE SENSEX
31,028
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm
Free float (%)
S&P CNX
9,595
HPCL IN
1,016
580.6 / 8.7
584 / 275
-3/5/83
1831
48.9
CMP: INR567
TP: INR632(+11%)
EBITDA above estimate; GRM at ~USD8/bbl
4QFY17 EBITDA stood at INR27.8b (est. of INR20.8b; +8% YoY, -3% QoQ), led by
(a) reported GRM of USD7.99/bbl (includes inventory loss of USD0.5/bbl) and (b)
product inventory gain of INR7b. Reported PAT rose 31% YoY (+14% QoQ) to
INR18.2b (est. of INR11.1b) as the impact of higher-than-expected interest cost
of INR2.3b (est. of INR700m; +15% YoY, +328% QoQ) was negated by higher
other income of INR5.2b (est. of INR3.3b; +7% YoY, +126% QoQ) and a lower tax
rate at 24% (v/s 34% in 3QFY17 and 37% in 4QFY17). Management has taken a
provision of INR4.5b on account of pay revision.
GRM at ~USD8/bbl:
HPCL’s core operating GRM of USD8.5/bbl was above
our estimate, with reported GRM at ~USD8/bbl (est. of USD5.6; +6% YoY,
+25% QoQ). Product inventory gains stood at INR7b in 4QFY17 v/s loss of
INR290m in 4QFY16 and INR7b in 3QFY17. Forex gain stood at INR1.5b in
4QFY17 v/s loss of INR1.6b in 3QFY17 and loss of INR3b in 4QFY16.
Marketing volumes including exports down 2% YoY:
While marketing sales
fell 2% YoY to 8.9mmt, refinery throughput was at 4.6mmt (-1.3% YoY, flat
QoQ).
Dividend of INR30/share for FY17:
Management has recommended a final
dividend of INR1.1/share, making total dividend of INR30/share (~5.3%
dividend yield) for FY17.
Nil subsidy sharing in 4QFY17:
As expected, subsidy sharing was nil in
4QFY17, and we model OMCs’ subsidy sharing at nil in FY18/FY19.
Valuation and view:
We value HPCL’s refining segment at 5x, marketing at 8x,
pipeline at 7.5x and add investments to arrive at a target price of INR632,
implying a total return of ~16% (11% + ~5.3% of dividend yield). HPCL trades at
12.4x FY19E standalone EPS of INR45.8. Maintain
Buy.
FY16
2Q
3Q
4Q
420,036 429,376 410,334
-18.7
-15.9
-7.9
-1,265 21,711 25,809
-0.3
5.1
6.3
5,428
6,960
6,670
1,650
1,639
1,966
3,640
2,725
4,802
-4,704 15,838 21,975
-1,499
5,425
8,096
32
34
37
-3,205 10,413 13,879
-137.7 -420.0
-35.8
-0.8
2.4
3.4
4.2
2.7
7.8
1.9
4.6
7.9
8.7
3.1
4.7
7.5
9.1
4.1
(INR Million)
FY16
FY17
FY17 Var. vs
FY17
2Q
3Q
4Q
4QE
est
420,306 484,856 514,142 1,776,949 1,867,097 517,206
-1%
0.1
12.9
25.3
-13.9
5.1
22.8
11,890 28,636 27,754
76,057 103,933 20,843
33%
2.8
5.9
5.4
4.3
5.6
4.0
6,160
6,336
6,749
26,566
25,353
6,817
-1%
1,164
530
2,268
6,483
5,357
700
224%
6,188
2,276
5,153
14,305
16,985
3,324
55%
10,755 24,046 23,890
57,313
90,208 16,650
43%
3,741
8,143
5,702
20,346
28,120
5,549
3%
35
34
24
36
31
33
7,013 15,903 18,188
36,967
62,088 11,100
64%
-318.8
52.7
31.0
35.2
68.0
-28.5
1.7
3.3
3.5
2.1
3.3
2.1
4.0
3.2
8.0
3.5
4.7
6.4
9.3
3.9
4.6
8.0
8.9
4.0
17.2
6.7
34.1
3.4
17.8
6.1
35.1
4.0
4.3
5.6
8.9
3.5
9%
41%
0%
15%
Financials & Valuations (INR b)
2017
2018E
Y/E Mar
1,870
1,755
Net Sales
105.8
94.7
EBITDA
62.1
46.4
PAT
61.0
45.6
EPS (INR)
66.6
(25.3)
Gr. (%)
200.1
229.6
BV/Sh (INR)
32.4
21.2
RoE (%)
18.8
11.6
RoCE (%)
9.3
12.4
P/E (x)
2.8
2.5
P/BV (x)
2019E
1,952
98.9
46.6
45.8
0.4
259.3
18.7
9.6
12.4
2.2
Estimate change
TP change
Rating change
Standalone - Quarterly Earning Model
Y/E March
Net Sales
YoY Cha nge (%)
EBITDA
Ma rgi ns (%)
Depreci a ti on
Interes t
Other Income
PBT
Ta x
Ra te (%)
Reported PAT
YoY Cha nge (%)
Ma rgi ns (%)
Key Assumptions
Refi ni ng throughput (mmt)
GRM (USD/bbl )
Ma rketi ng s a l es vol ume i ncl exports (mmt)
Ma rketi ng GM per l i tre (INR/l i tre)
E: MOSL Es ti ma tes
1Q
517,204
-12.6
29,802
5.8
7,508
1,227
3,138
24,204
8,324
34
15,880
3,349.3
3.1
3.8
8.6
8.6
4.5
1Q
447,793
-13.4
35,653
8.0
6,108
1,395
3,368
31,518
10,534
33
20,984
32.1
4.7
4.5
6.8
8.9
4.7
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Swarnendu Bhushan
(Swarnendu.Bhushan@MotilalOswal.com); +91 22 6129 1529
Abhinil Dahiwale
(Abhinil.Dahiwale@motilaloswal.com); +91 22 3980 4309

HPCL
Exhibit 1: HPCL Quarterly earnings snapshot (INRm)
1QFY16
Key Operating Metrics
Crude cost (USD/bbl)
Fx rate (INR/USD)
Marketing volume (mmt)
GRM (USD/bbl)
Reuters Singapore GRM (USD/bbl)
Refinery thr' put (mmt)
Financial Summary (INRm)
Net Sales
Adj. EBITDA
Refining
Marketing & others
EBITDA Margin (%)
Adventitious gain/(loss)
Net subsidy gain/(loss)
Forex gain/(loss)
Reported EBITDA
EBITDA Margin (%)
Depreciation
EBIT
Interest
Other Income
PBT b/f exceptionals
Exceptionals
PBT
Income Tax
Tax rate (%)
PAT
PAT margin (%)
EPS
62.7
63.5
8.6
8.6
8.0
3.8
2QFY16
50.7
64.9
7.8
2.7
8.0
4.2
3QFY16
42.7
65.9
8.7
7.9
8.0
4.6
429,376
26,194
13,455
12,740
6.1%
(4,220)
430
0
22,404
5.2%
(6,960)
15,445
(1,639)
2,725
16,530
0
16,530
(5,425)
32.8%
11,105
2.6%
10.9
4QFY16
32.3
67.5
9.1
7.5
8.0
4.7
1QFY17
44.6
66.9
8.9
6.8
8.0
4.5
2QFY17
44.7
67.0
8.0
3.2
8.0
4.0
420,306
16,609
2,853
13,756
4.0%
(4,000)
0
0
12,609
3.0%
(6,160)
6,450
(1,164)
6,188
11,473
0
11,473
(3,741)
32.6%
7,732
1.8%
7.6
3QFY17
49.6
67.4
9.3
6.4
8.0
4.7
484,856
22,336
10,631
11,705
4.6%
7,000
0
(1,303)
28,033
5.8%
(6,336)
21,698
(530)
3,579
24,747
0
24,747
(8,143)
32.9%
16,604
3.4%
16.3
4QFY17 YoY (%) QoQ (%)
53.4
67.2
8.9
8.0
8.0
4.6
514,142
28,860
14,224
14,636
5.6%
0
0
0
28,860
5.6%
(6,749)
22,111
(2,268)
5,153
24,996
0
24,996
(5,702)
22.8%
19,294
3.8%
19.0
65%
0%
-2%
6%
0%
-1%
25%
8%
6%
9%
-100%
-100%
-
8%
1%
11%
15%
7%
9%
9%
-30%
31%
31%
8%
0%
-5%
25%
0%
0%
6%
29%
34%
25%
-100%
-
-
3%
7%
2%
328%
44%
1%
1%
-30%
16%
16%
513,861 420,373
25,192
13,333
11,864
1,893
13,328
11,440
4.9%
3.2%
5,800
(14,000)
0
0
0
0
30,992
(667)
6.0%
-0.2%
(7,513) (5,389)
23,479
(6,056)
(1,248) (1,683)
3,199
3,778
25,431
(3,961)
0
0
25,431
(3,961)
(8,461)
1,477
33.3%
37.3%
16,970
(2,484)
3.3%
-0.6%
16.7
(2.4)
410,334 447,793
26,743
25,268
13,357
11,111
13,387
14,158
6.5%
5.6%
290
11,000
(370)
0
0
0
26,663
36,268
6.5%
8.1%
(6,670) (6,108)
19,993
30,160
(1,966) (1,395)
4,802
3,368
22,830
32,133
0
0
22,830
32,133
(8,096) (10,534)
35.5%
32.8%
14,734
21,599
3.6%
4.8%
14.5
21.2
Source: Company, MOSL
Exhibit 2: Ad-hoc subsidy sharing resulting in volatile quarterly profits (INRb)
PAT
Net (under)/over recovery
Source: Company, MOSL
26 May 2017
2

HPCL
Exhibit 3: HPCL Marketing volume trend – -2.1% YoY and -4.5% QoQ (mmt)
7.7
7.7
7.8
7.9
7.8
8.0
8.3
8.1
8.2
8.6
7.8
8.7
9.1
8.9
9.3
8.0
8.9
7.2
7.2
7.4
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
FY13
FY14
FY15
FY16
FY17
Source: Company, MOSL
Exhibit 4: HPCL GRM trend – 4QFY17 GRM at USD7.99/bbl vs SG GRM of USD6.4/bbl
(In USD/bbl)
9.1
6.6
6.7
9.0
6.5
5.5
6.2
4.3
4.7
2.3
2.0
2.1
(1.0)
2.7
HPCL GRM
5.7
Singapore GRM
8.6
8.0
6.3
7.5
8.6
6.3
7.8
7.9
7.8
7.5
5.0
6.8
5.1
6.4
3.2
6.4
8.0
6.7
4.8
4.4
1.9
(2.1)
3.7
2.6
3.9
Source: Company, MOSL
Exhibit 5: HPCL refinery-wise throughput trend; -1% YoY, flat QoQ
Refinery thr'put (mmt)
4.2
3.6
3.7
1.5
2.2
2.4
1.7
4.4
3.4
3.9
3.8
3.3
1.9
1.9
2.3
1.9
2.0
2.0
3Q
2.0
2.0
1.9
3Q
2.0
2.5
2.0
2.4
2.1
Mumbai
4.4
Vizag
4.5
4.0
Total
4.5
3.8
4.2
4.6
4.7
4.5
4.7
4.0
2.5
2.4
4.7
2.1
2.5
2.5
2.4
2.0
2.0
1.6
1Q
2.1
2.0
2.0
1.7
1Q
1.4
1Q
1.6
1Q
2.1
2.1
2.2
2.1
2.1
2.2
2.2
2Q
3Q
4Q
2Q
4Q
2Q
4Q
2Q
3Q
4Q
1Q
2Q
3Q
4Q
FY13
FY14
FY15
FY16
FY17
Source: Company, MOSL
26 May 2017
3

HPCL
Valuation and view
HPCL is embarking upon a huge capex cycle with Vizag expansion, BS-VI,
Rajasthan refinery & marketing complex. We believe that it will spend at least
INR100b each year going forward.
Additionally, with no major refinery expansion in the near term, it may lose
market share to IOCL in the South as IOCL will have access to more refined
products with commissioning of Paradip refinery. Private players have also
become aggressive in retail and all OMCs will lose market share going forward.
However, Bhatinda refinery would show further improvement through
reduction in debt/interest cost.
We value HPCL’s refining segment at 5x, marketing at 8x, pipeline at 7.5x and
add investments to arrive at a target price of INR632, implying a total return of
~16% (11% + ~5.3% of dividend yield). HPCL trades at 12.4x FY19E standalone
EPS of INR45.8. Maintain
Buy.
Exhibit 6: HPCL – Key Assumptions
Y End: March 31
Exchange Rate (INR/USD)
Brent Crude (USD/bbl)
Market Sales (MMT)
YoY (%)
GRM (USD/bbl)
Singapore GRM (USD/bbl)
Prem/(disc) (USD/bbl)
Total Refinery throughput (MMT)
YoY (%)
Refining capacity utilization (%)
Blended marketing margin excld inventory (INR/lit)
Under recoveries Sharing (INRb)
Gross under recoveries
Upstream sharing
Govt. sharing
Net sharing
Net sharing (%)
2010
47
70
26
2.7
3.6
(1)
15.8
113%
2011
46
87
27
3
5.3
5.2
0
14.8
-6%
105%
2012 2013 2014 2015 2016 2017
48
54
61
61
65
67
114
111
107
86
47
49
29
30
31
32
34
35
9
3
2
3
7
3
2.9
2.1
3.4
2.8
6.7
6.2
8.3
7.9
5.6
6.4
7.5
5.8
(5)
(6)
(2)
(4)
(1)
0
16.2 15.8 15.5 16.2 17.2 17.8
10%
-3%
-2%
4%
6%
3%
109% 107% 105% 109% 116% 120%
4.5
3.8
3.7
304
121
183
0
0%
360
133
225
2
1%
325
168
152
5
1%
164
109
51
5
3%
20
2
18
0
0%
33
-
33
-
0%
2018E
69
55
37
5
5.0
5
(0)
16.0
-10%
108%
3.8
48
-
48
-
0%
2019E
70
60
38
4
5.1
5
(0)
16.0
0%
108%
3.8
80
-
80
-
0%
100
32
56
12
12%
171
66
90
15
9%
Source: Company, MOSL
26 May 2017
4

HPCL
Story in charts
Exhibit 7: HPCL’s GRMs have underperformed Singapore
GRM (USD/bbl)
Prem/(Disc) to Singapore
Singapore GRM
7.7
8.2
3.6
5.2
5.2
2.1
(3.0)
(5.6)
3.4
(2.2)
2.8
(0.8)
(3.5)
6.4
HPCL Blended GRM
7.5
6.7
5.8
6.2
0.4
Exhibit 8: While refining capacity has been largely flat,
marketing sales have shown steady increase
Marketing Sales (mmt)
32
Refinery Throughput (mmt)
38
37
35
34
5.6
5.4
5.4
26
27
29
30
31
4.5
3.0
(0.6) (0.7)
5.0 5.1
(0.4) (0.4)
16
16
16
16
15
16
17
18
16
16
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18E FY19E
Source: Company, MOSL
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18E FY19E
Source: Company, MOSL
Exhibit 9: Expect EBITDA to be driven up higher marketing
margins
EBITDA (INRb)
PAT (INRb)
106
79
52
54
58
27
90
70
70
95
99
Exhibit 10: Expect D/E ratio to decline with increasing
profitability (x)
D/E Ratio
2.0
2.3
2.4
2.1
1
1.8
25
13
33
15
34
39
1
1
1
1
9
9
17
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18E FY19E
Source: Company, MOSL
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18E FY19E
Source: Company, MOSL
Exhibit 11: Diesel deregulation to reduce working capital
leading to lower interest costs
Total Debt (INRb)
17
18
15
9
Interest Cost (INRb)
Exhibit 12: HPCL: 1 Year Forward P/E Chart
27
22
17
PE (x)
Peak(x)
Avg(x)
24.6
11.8
Min(x)
9
9
7
298
325
319
171
7
144
5
172
7
270
12
7
2.6
9.0
213
250
330
2
FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18E FY19E
Source: Company, MOSL
Source: Company, MOSL
26 May 2017
5

HPCL
Financials and Valuations
Standalone - Income Statement
Y/E March
Net Sales
Change (%)
Finished Goods
Raw Materials Cons
Other Exp
Total Expenditure
% of Sales
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income
PBT bef. EO Exp.
EO Items
PBT after EO Exp.
Total Tax
Tax Rate (%)
Reported PAT
Adjusted PAT
Change (%)
Margin (%)
FY13
2,065,293
15.9
1,281,786
639,921
104,163
2,025,869
98.1
39,424
1.9
19,315
20,109
18,377
12,300
14,032
714
14,746
5,699
38.6
9,047
8,334
-8.6
0.4
FY14
2,231,454
8.0
1,451,380
613,881
114,112
2,179,372
97.7
52,081
2.3
21,884
30,197
15,046
11,004
26,155
0
26,155
8,817
33.7
17,338
17,338
108.0
0.8
FY15
2,063,804
-7.5
1,292,784
599,079
117,765
2,009,627
97.4
54,176
2.6
19,712
34,465
7,066
14,142
41,541
0
41,541
14,209
34.2
27,333
27,333
57.6
1.3
FY16
1,777,006
-13.9
1,159,484
409,025
129,104
1,697,613
95.5
79,393
4.5
26,532
52,861
6,536
11,442
57,766
0
57,766
20,505
35.5
37,262
37,262
36.3
2.1
FY17
1,870,237
5.2
1,227,317
406,836
130,313
1,764,467
94.3
105,771
5.7
25,353
80,418
5,357
15,147
90,208
0
90,208
28,120
31.2
62,088
62,088
66.6
3.3
FY18E
1,755,377
-6.1
1,095,883
436,482
128,271
1,660,636
94.6
94,741
5.4
29,087
65,653
6,626
10,518
69,546
0
69,546
23,180
33.3
46,366
46,366
-25.3
2.6
(INR Million)
FY19E
1,952,012
11.2
1,233,565
486,589
132,915
1,853,069
94.9
98,942
5.1
31,087
67,855
9,000
10,974
69,829
0
69,829
23,274
33.3
46,555
46,555
0.4
2.4
Standalone - Balance Sheet
Y/E March
Equity Share Capital
Total Reserves
Net Worth
Total Loans
Deferred Tax Liabilities
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Total Investments
Curr. Assets, Loans&Adv.
Inventory
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Provisions
Net Current Assets
Appl. of Funds
E: MOSL Estimates
FY13
3,390
133,874
137,264
324,583
35,984
497,830
370,062
144,575
225,487
51,729
106,269
378,962
164,387
49,350
1,471
163,754
264,617
241,622
22,995
114,345
497,830
FY14
3,390
146,732
150,122
319,301
39,084
508,506
424,668
165,545
259,122
45,856
108,599
362,204
187,754
54,660
347
119,444
267,275
243,978
23,296
94,930
508,506
FY15
3,390
156,831
160,221
170,556
41,036
371,813
481,749
191,121
290,628
34,744
112,415
237,719
129,723
36,031
171
71,796
303,693
273,903
29,790
-65,974
371,813
FY16
3,390
176,308
179,698
143,950
52,814
376,461
547,104
216,028
331,076
18,528
105,786
240,404
132,114
37,580
238
70,472
319,332
301,228
18,104
-78,928
376,461
FY17
10,170
193,311
203,482
171,706
59,682
434,869
604,615
243,296
361,319
18,105
109,186
296,037
185,763
40,642
337
69,296
349,777
323,869
25,908
-53,740
434,869
FY18E
10,170
223,369
233,539
270,000
59,682
563,221
601,749
272,383
329,366
120,970
109,186
295,705
100,093
19,237
101,952
74,422
292,005
272,981
19,024
3,699
563,221
(INR Million)
FY19E
10,170
253,549
263,720
330,000
59,682
653,402
641,749
303,471
338,278
180,970
109,186
349,556
121,846
21,392
128,393
77,926
324,589
304,614
19,975
24,967
653,402
26 May 2017
6

HPCL
Financials and Valuations
Ratios
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
FCF per share
Return Ratios (%)
RoE
RoCE
RoIC
Working Capital Ratios
Asset Turnover (x)
Debtor (Days)
Leverage Ratio (x)
Net Debt/Equity
FY13
8.2
27.2
135.0
2.8
37.2
69.3
20.9
4.2
0.4
22.8
0.5
-44.3
6.2
4.6
3.9
4.1
9
1.6
FY14
17.0
38.6
147.6
5.2
35.4
33.3
14.7
3.8
0.4
17.2
0.9
10.8
12.1
5.9
5.8
4.4
9
1.4
FY15
26.9
46.3
157.5
8.2
36.5
21.1
12.3
3.6
0.4
13.8
1.4
166.8
17.6
8.0
7.8
5.6
6
0.4
FY16
36.6
62.7
176.7
11.5
37.7
15.5
9.0
3.2
0.4
9.1
2.0
37.2
21.9
12.7
14.3
4.7
8
0.2
FY17
61.0
86.0
200.1
30.0
57.5
9.3
6.6
2.8
0.4
7.1
5.3
13.8
32.4
18.8
19.8
4.3
8
0.3
FY18E
45.6
74.2
229.6
13.7
35.2
12.4
7.6
2.5
0.4
7.9
2.4
19.3
21.2
11.6
16.3
3.1
4
0.3
FY19E
45.8
76.3
259.3
13.8
35.2
12.4
7.4
2.2
0.4
7.9
2.4
-16.9
18.7
9.6
19.4
3.0
4
0.4
Standalone - Cash Flow Statement
Y/E March
OP/(Loss) before Tax
Depreciation
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
Others
CF from Operating incl EO
(Inc)/Dec in FA
Free Cash Flow
(Pur)/Sale of Investments
CF from Investments
Inc/(Dec) in Debt
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Opening Balance
Closing Balance
FY13
14,746
19,344
-5,699
-34,913
-6,522
5,131
-1,391
-43,619
-45,010
-2,564
-46,183
49,790
-3,368
359
46,782
-792
2,264
1,471
FY14
26,155
21,884
-8,817
18,291
57,513
3,101
60,614
-49,647
10,968
-2,329
-51,976
-5,282
-6,141
1,661
-9,762
-1,124
1,471
347
FY15
41,541
19,712
-14,209
160,727
207,771
1,952
209,723
-40,106
169,617
-3,816
-43,922
-148,744
-9,985
-7,248
-165,977
-176
347
171
FY16
57,766
26,532
-20,505
13,021
76,815
11,778
88,592
-50,763
37,829
6,629
-44,134
-26,607
-14,061
-3,724
-44,391
67
171
238
FY17
90,208
25,353
-28,120
-25,088
62,352
6,868
69,221
-55,173
14,048
-3,400
-58,573
27,756
-35,702
-2,602
-10,548
99
238
337
(INR Million)
FY18E
69,546
29,087
-23,180
44,176
119,630
0
119,630
-100,000
19,630
0
-100,000
98,294
-16,308
0
81,986
101,616
337
101,952
FY19E
69,829
31,087
-23,274
5,173
82,815
0
82,815
-100,000
-17,185
0
-100,000
60,000
-16,375
0
43,625
26,440
101,952
128,393
26 May 2017
7

HPCL
Corporate profile
Company description
Fortune-500 company, HPCL is a refining and
marketing company in India and also has interests
in upstream. It owns 14.8mmt of refining capacity,
split across Mumbai (6.5mmt) and Vishakapatnam
(8.3mmt). It has a crude and product pipeline
network of ~2,400km and sells ~30mmt of
petroleum products. HPCL also holds a 16.9% stake
in MRPL and 49% stake in 9mmt Bhatinda refinery.
HPCL is a state-owned company, with 51.1%
Government of India (GoI) stake.
Exhibit 2: Shareholding pattern (%)
Mar-17
Promoter
DII
FII
Others
51.1
9.6
16.9
22.4
Dec-16
51.1
10.0
17.7
21.2
Mar-16
51.1
14.0
19.3
15.6
Source: Capitaline
Source: Capitaline
Exhibit 1: Sensex rebased
Source: MOSL/Bloomberg
Exhibit 3: Top holders
Holder Name
LIFE INSURANCE CORPORATION OF INDIA
STICHING DEPOSITORY APG EMERGING
MARKETS EQUITY POOL
% Holding
2.1
1.5
Note: FII Includes depository receipts
Exhibit 4: Top management
Name
Mukesh Kumar Surana
J Ramaswamy
Pushp Kumar Joshi
S Jeya Krishnan
Shrikant M Bhosekar
Designation
Chairman & Managing
Director
Director (Finance) &
CFO
Director
(Human
Resources)
Director (Marketing)
Company Secretary
Exhibit 5: Directors
Name
Sandeep Poundrik
Vinod S Shenoy
Name
Urvashi Sadhwani
Ram Niwas Jain
*Independent
Source: Capitaline
Exhibit 6: Auditors
Name
A Ramachandra Rao & Co
CMA Rohit J Vora
CVK & Associates
G M Kapadia & Co
R Nanabhoy & Co
Branch
Cost Auditor
Statutory
Statutory
Cost Auditor
Source: Capitaline
Type
Exhibit 7: MOSL forecast v/s consensus
EPS
(INR)
FY18
FY19
MOSL
forecast
45.6
45.8
Consensus
forecast
51.8
53.3
Variation (%)
-12.0
-14.1
Source: Bloomberg
26 May 2017
8

HPCL
NOTES
26 May 2017
9

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HPCL
Disclosure of Interest Statement
Analyst ownership of the stock
No
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No
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