BPCL - Result Update - Emkay

Reco: ACCUMULATE
CMP: Rs 589
Target Price: Rs 655

In black on additional govt support

- BPCL reported results which were above our and street estimates with EBIDTA at Rs.37bn and Net profit at Rs31.3bn, while revenue grew by 60.4% YoY to Rs.588bn

During the quarter company received budgetary support of Rs69.9bn from the government, while discount from upstream company was Rs.35.7bn

- Average gross refining margin for Q3 FY12 was at $3.6/bbl as compared to $1.6/bbl, growth of 118% QoQ, mainly led by higher product spread in heavy distillates segment especially in FO

- Lowered our earnings for FY12E on account of higher under recovery and increased earnings for FY13E on higher Bina thruput. At CMP stock provides limited upside, maintain ACCUMULATE with revised TP of Rs.655.

Source : Equity Bulls

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