Hindustan Petroleum Corporation (HINDPETRO) investor relations material

Executive summary

• The company, with over 100 years of Maharatna operations and a strong pan-India presence, faced extreme crude price volatility, operational challenges, and significant inventory losses, but maintained supply continuity and launched new initiatives like the HRRL refinery and HP Navya LPG product.

• The Rajasthan refinery (HRRL) commenced commercial operations, ramping up to 60% utilization, with full capacity expected by Q3 and petchem by year-end.

• The board approved unaudited standalone and consolidated financial results for Q1 FY27, confirming compliance with accounting standards and SEBI regulations.

• A seven-pronged response strategy was implemented, focusing on balance sheet improvement, CapEx control, interest cost management, profitability programs, retail and refinery optimization, and digital transformation.

• The company is recognized for corporate governance and rated at par with India's sovereign rating by Moody's and Fitch.

Financial highlights

• Q1 FY27 standalone total income was ₹1,46,407.30 crore, with a net loss of ₹11,526.41 crore; consolidated net loss was ₹12,264.67 crore.

• Average Gross Refining Margin (GRM) for Q1 FY27 was $23.80/bbl, but profitability was impacted by suppressed marketing margins.

• Significant under-recoveries were reported, with marketing under-recovery exceeding INR 26,000 crore for the quarter, mainly on MS, HSD, and LPG.

• LPG losses averaged INR 510 per cylinder for the quarter, with June at INR 680 and July at INR 490.

• Debt rose to ₹75,913.53 crore (consolidated) and ₹72,596.95 crore (standalone) as of June 30, 2026, with debt-equity increasing to 1.52 (standalone).

Outlook and guidance

• Management is confident about a turnaround, expecting improved performance from Q3 as new assets stabilize and supply chain optimizations take effect.

• CapEx for FY 2027 is targeted at INR 9,700 crore but may be lower depending on market conditions; focus remains on essential and critical spends.

• Compensation of ₹7,920 crore for LPG under-recoveries to be disbursed in 12 monthly instalments, with ₹1,980 crore recognized for Q1 FY27.

• Committed to achieving net zero Scope 1 & 2 emissions by 2040 with a ₹60,000 crore investment.

• Plans to increase refining capacity from 35.8 MMTPA (2025-26) to 45.3 MMTPA (2027-28).