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Surge in BPCL and HPCL Stocks After Strong FY24 Results

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As per Reports, positive movements for both BPCL and HPCL. Shares of Bharat Petroleum Corporation Limited (BPCL) and Hindustan Petroleum Corporation Limited (HPCL) experienced significant gains following the announcement of robust financial results for FY 2024. BPCL’s shares saw an increase of 5% to ₹621.95, while HPCL’s shares rose by 2.6% to ₹514.40,

Annual Financial Highlights and Market Performance of BPCL and HPCL

Both BPCL and HPCL posted impressive performance metrics for the fiscal year, outshining their quarterly results. This surge is attributed to the stable petrol and diesel prices throughout the year, despite the ongoing global economic pressures such as the crude oil price hike following the Ukraine conflict in 2022. Notably, global oil prices stabilized in 2023, aiding the profit margins of these companies.

BPCL and HPCL

BPCL reported a consolidated net profit of ₹4,789.57 crore in the last quarter of FY24, albeit lower than the previous year’s ₹6,870.47 crore. However, its annual net profit soared to a record ₹26,858.84 crore, up from ₹2,131.05 crore in the previous year. The company’s gross refining margin also saw a significant rise to USD 14.14 per barrel from USD 8.83. BPCL processed 39.93 million tonnes of crude and its market sales increased by 4.33% to 51.04 million tonnes.

Meanwhile, HPCL recorded a 25% drop in net profit in the March quarter of FY24, at ₹2,709.31 crore, mainly due to lower refining margins. Despite this, it marked a record annual net profit of ₹16,014.61 crore, recovering from a loss of ₹6,980.23 crore in the previous year.

Expansion and Ethanol Blending

BPCL focused on expanding its network and ethanol blending capabilities. It maintained an average ethanol blend of 11.69%, peaking at 12.15% in the last quarter. Additionally, BPCL added 308 new petrol pumps, bringing the total to 21,840, and launched 323 new CNG stations, totaling 2,031.

Bonus Shares and Dividends

BPCL and HPCL companies announced attractive bonus shares and dividends. BPCL’s board approved a 1:1 bonus share issue and proposed a final dividend of ₹21 per share, while HPCL will issue bonus shares at a 1:2 ratio and recommended a final dividend of ₹16.50 per share for FY23-24, on top of an earlier interim dividend of ₹15 per share.

Brokerage Recommendations BPCL and HPCL

Despite some price adjustments, Citi, a global brokerage firm, recommends buying BPCL shares with a target price of ₹760, and suggests a slightly reduced target price of ₹630 for HPCL shares.

Investment Advice

Investors are advised to consult with qualified professionals before making any investment decisions, as stock market investments can be volatile and require careful analysis.

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