Bongaigaon Refinery and Petrochemicals Limited’s (BRPL’s) revenue declined 24% y-o-y, to Rs.11.1bn. EBITDA was down Rs2.6 billion, vis-à-vis Rs1.3 billion a year ago.
Apart from lower international refining margins, the sharp fall in crude prices (from $97/bbl at end-September to $42 at end-December 08) have impacted profitability.
We expect the Q3FY09 results of all PSU refiners to be impacted by inventory losses on account of the fall in crude prices. The results of refining and marketing companies (IOC, BPCL, HPCL) would also be hit by inventory losses in the marketing business, partly compensated by lower subsidies.
BRPL’s physical performance improved in Q3FY09, with crude throughput rising to 0.56m tonnes, a 20.5% jump y-o-y. Capacity utilization was 95.1% in 3QFY09, vis-à-vis 79.1% a year earlier. This was primarily on account of greater availability of crude.
We do not directly cover BRPL. At the ruling market price of Rs42.40, the stock trades at a PE of 2.9x its trailing FY08 EPS.