Share of HPCL rose 8 per cent in the morning session to hit a fresh 52-week high of Rs 288.15 on BSE after the state-run oil retailer reported better than expected operating performance.
The company reported a standalone net profit of Rs 3,017.96 crore for the quarter ended March 31. Profit in the December quarter stood at Rs 2,354.64 crore.
The stock opened 5.8 per cent higher at Rs 282.00 against the previous close of Rs 266.45. The stock has gained 53 per cent in one year and risen 27 per cent since the beginning of this year. HPCL's share stands higher than 5 day, 10 day, 20 day, 50 day, 100 day, and 200 day moving averages. Market cap of the firm rose to Rs 39,322.16 crore.
Revenue from operations increased by 10.1 percent sequentially to Rs 85,203.55 crore for the quarter ended March 31. For FY21, Revenue from operations declined 5.9 per cent to Rs 2,70,326.32 crore as against Rs 2,87,417 in the fiscal year 2020.
Average Gross Refining Margin during the year ended March 31, 2021, was $ 3.86 per barrel as against $ 1.02 per barrel during the corresponding previous year.
"Enhanced profitability was a result of robust operational performance, improvement in refinery margins helped by inventory gains and favourable exchange rate variations," HPCL Chairman and Managing Director M K Surana told reporters.
Citi maintains a 'Buy' call on the stock given attractive valuations with a target at Rs 295 per share. The brokerage house added that HPCL reported exceptionally strong performance throughout the year.
JP Morgan has increased FY22-23 EPS estimates for HPCL by 14 percent and 8 percent after Q4 earnings.
Jefferies noted that the significant EBITDA beat was on much higher inventory gains in refining and marketing for HPCL. It maintains a 'Buy' call on the stock with a target at Rs 370 per share.
"Despite pandemic, being in the business of essential commodity, all critical supply locations have continued operating even during the lockdown period with health, hygiene and safety measures in place. Both Refineries and all the supply distribution locations including bulk storage terminals and depots, LPG bottling plants, aviation fuel stations, lube blending plants, etc., functioned all through the year with optimized manpower during the lockdown period," said the company in its BSE filing.
"Being in the business of essential commodity, using the principles of prudence in applying judgments and estimates, the Group expects no significant impact on the continuity of operations of the business on a long term basis and expects to recover carrying amount of assets, investments, loans, trade receivable, etc. On the Capex front, the Group expects to go ahead with its CAPEX plans and ensure execution of the same," it added.
Also, the Board has recommended a final dividend of Rs 22.75 per equity share for the financial year 2020-2021.