Sir, firstly, I would like to congratulate you and your entire team at Indian Oil for posting a superb set of results and also season's greetings for you, though it is a bit too late. Sir, now, firstly, I would like to just touch upon a few things to you as thank you, sir, as an investor. Sir, today, it is very heartening to see your presentation Sprint. And in that, Indian Oil is about 3% of India's GDP. Now, sir, 3% of India's GDP is nearly Rs. 12 lakh crores. Okay. And today, if you look at it from an investor angle, our market cap is around Rs. 2-2.5 lakh crores. I mean, Rs. 2 lakh crores rather in spite of having an asset base of nearly Rs. 5.5 lakh crores. Today, sir, it is a proud fact for India that about 3.5 crores Indians use the Indian Oil fuel pump on a daily basis. So, very clearly, on one side of the equation, you are doing a fantastic role on energy security of India, the consumers of India are using. But sir, as an investor or as being India's national asset, the company is not being valued. I mean, today, having a market cap of barely Rs. 2,10,000 crores is clearly not in the right spectrum of things because today our valuation is being valued like a commodity company. But the matter of fact is that you are a consumer company, right, because 3.5 crores Indians use it. I mean, you are 2% of India's corporate profit. Sir, today India makes about Rs. 15 lakh crores, and Indian Oil makes about Rs. 35,000 crores. But the matter of fact is that there is some disconnect somewhere where Indian Oil and rather the oil marketing companies are not getting the valuation which they should get. The matter of fact is that the Government of India has also now paid the LPG money, of the Rs. 300 billion, which you highlighted monthly is going to come. So, sir, the fact of the matter is that these are very valuable companies, but somehow the market is not getting the confidence in the earnings. So, I would, sir, request you to please give the market some confidence on the earnings aspect because otherwise, a market which trades at 22 PE, there should be absolutely no reason why not only Indian Oil, but all the oil marketing companies trade at sub-6PE with ROEs of 22%. So, I would really request you that the management should explicitly give the market more confidence on earnings because even the refining cycle is in your favor, crude is in your favor, Government of India is in your favor . The company is doing very well. But s omehow the investors are not getting the confidence. So, I would only humbly request you to please give some confidence because you guys are doing a superb job. So, there is nothing I have to ask you because Russian crude, sir, whether it's 15%, 20%, it's all optics, right ? Because it is going to move the needle hardly a few crores here or there. So, please give the market confidence is all I request you. I wish you all the best. Good luck, and God bless you also.
Questions across 7 calls
Sumeet Rohra
Smartsun Capital
Indian Oil Corporation Limited
Sir, just a couple of questions. First, if you can -- firstly, your performance has been very commendable. So congratulations on that. You guys have done a very, very good performance in a very challenging environment. Sir, I'm just looking at overall profitability rather than on any quarter because the thing is that if we see that we reported approximately a profit of about INR13,000 crores, and this is after absorbing the LPG under recovery, which is of INR19, 0000 crores, INR20,000 crores. No, sir, of course, LPG is a controlled product and the government will compensate you on that. So sorry, can you please throw some idea on when we could receive the LPG money? And sir, secondly, you spoke about capex coming down from INR37 million to about INR33 million, INR34 million. Now sir, the matter of fact is that we always speak on capex. But can you also talk a little bit on earnings momentum? Because over the last couple of financial years, you have -- all of you have done very well so can we just get a sense on how do you expect earnings to shape up in the current year? Because now crude is also in our favor, right? I mean it's below $70 on a sustained -- hopefully, on a sustainable basis. So sir, can you please talk a little bit about how do you see profitability shaping up in a conducive environment of crude? My second question, sir, is on the retail outlets. So how many retail outlets do we have currently? And how many have we added and how many do you plan to add? And my last question, sir, is on GRM. So do you expect -- I mean, what do you expect in sustainable GRM scenario for the current year, sir?
Hi, sir. Thanks for the opportunity. Sir, just a couple of things. I was basically just wondering from now from an investor point of view that our dividend payout in absolute number of rupees has been lower this year because of the LPG under recovery money that we've not received which has hampered profitability. So sir, is it safe to assume that when -- once you get the LPG under recovery from the government, investors can expect a dividend payout which was similar to FY '24 levels? Because anyway, 53% of the one money goes back to the government itself. So can we expect that? And sir, secondly, on the LPG part as well, if I remember the honorable oil minister had mentioned that prices will be reviewed on a 30-day basis or slightly lower on a fortnightly basis. So do you get the early sense that we could be entering an era of LP G prices could be market aligned and then eventually decontrol. Any thoughts on that, sir?
Engineers India Limited
Sir, I'll just keep it very brief. So with the order book visibility, which you have in hand today and with the robust order flow, which you're expecting like last financial year. So now can we basically say that we can basically expect this 15% to 20% rev enue growth which you expect for current year to be a recurring phenomenon? And can we now basically expect that Engineers India is now basically well on the growth path? That's my first part, sir. And secondly, sir, the thing is that if revenue is going to grow 15% to 20%, our PAT margin has been about 18% the last financial year. So do you think that operating leverage can also kick in because of the fact that revenue growth does kick in. So what's the PAT margin which you basically expect for current financial year? Lastly, for my last question is basically this energy transition, which is basically getting momentum around the world and with the green energy not been as lucrative as earlier planned and peak oil being far ahead compared to what it was anticipated in the very short term. What do you think could be the order momentum, particularly from the Middle East because of the fact that you're opening offices in Dubai and Saudi as well, which you've highlighted earlier? So do you actually think that with green energy being stalled, et cetera, et cetera. Do you think that order momentum on this side of the conventional business can actually accelerate? EIL Let me tell me first about the order book position. As we have told earlier, our order book was ranging in the INR8,000 crores. Now it has increased to INR11,700 crores. And definitely, with the execution, our turnoff will rise, and we will put all efforts to take it increase -- by increase of 15% to 20%. Definitely, we are also targeting. But how much PAT will be there, we cannot tell right now because we have already told our margins in the consultancy segment is around 25% business segment. And in the LSTK job, it is 5% to 7%. So definitely, our bottom l ine is also going to improve. But how much that we cannot tell you right now...
Okay. But sir, I mean I assume that basically, what you have reported in the last financial year should actually be kind of where we can build on from, correct? I mean, is that understanding correct? EIL Yes exactly. That we will put all of us to keep that base.
NBCC (India) Limited
Firstly, sir, I mean I would like to congratulate you on a very good performance, which you have reported in this financial year, and also on securing a very good amount of orders as you've highlighted. Now sir, I would like to -- I have about a few questions. So if I can just shoot them to you and then we can -- you can address them. So sir, now given the order book of INR120,000 crores today on a consolidated basis, what is the duration, sir, you have to basically execute these orders? If you can also please help us understand that in last financial year, you reported INR12,000 crores revenue. So what's the revenue number that you think that we can expect for current financial year, sir? Secondly, as you've highlighted that your order book has expanded very sharply this year. So what do you expect are the forthcoming orders or the kind of order value which we can add in the current financial year? Now sir, my question, this one is a bit on the results. There is an exceptional item, point number 6, which is of INR95.65 crores. Can you, sir, explain what is this, exceptional item and is this, a recurring item in the P&L? Also, sir, under expenses, there is something of about INR47 crores write-off. What is the write-off and if you can just throw a bit of light on that? One more question, sir, I had, if I may, was basically on the Mehrauli project. Is there any progress on the Mehrauli project? And do you expect something on the project to start?
Sure. And sir, just basically on the new orders, because this year, you added about INR65,000 crores, INR70,000 crores of new orders. So what is -- I mean, the order intake you expect for current year? And I mean, are there any particular projects which you think that we can get soon?
Hindustan Petroleum Corporation Limited
Yes. Hi, sir. I mean, a very good morning, chairman, sir, to you and welcome to your first call. And good morning, Peter, to team HVCL. Sir, you have done a commendable performance in a very challenging environment. You've reported actually INR7,300 crore s of profit after absorbing, you know, INR10,000 crores, which is truly commendable. And you've actually surpassed FY20 for profit. So, you know, it's actually heartening to see such a strong co-performance by you and your team. So I have a few questions. So, you know, firstly on the LPG part, I mean, what is, you know, your thought, you know, on the LPG under recovery? And what's the way forward? Because, you know, today, I mean, your under - recoveries are already at 10,500. So, any thought on the compensation aspect from the government? And when do you expect to receive anything on that? My second qu estion, sir, is basically, you know, on the demerger of the lubricant. Because today, sir, I mean, the matter of fact is that H PCL's market cap truly doesn't reflect its true intrinsic value, because it's at about $10 billion. And $10 billion is just the cost to set up one refinery in India today. But whereas HPCL giant is available at this market cap. So, sir, any thought, on value unlocking on the lubricant part? Because today, you know, our nearest competitor, Castrol, you know, is got whose one -third of size has got a market cap of about 25,000. So, you know, there can be huge value unlocking for us on the lubricant part. Sir, my third question would be on the Vizag residue upgradation project. So, if I heard you correctly, sir, you said that that shou ld basically start maybe in the next quarter. So, is my understanding correct that, you know, you'd get about a $3 to $4 benefit on the GRMs for the whole refinery, sir?
Sure, sir. Thank you so much.
Bharat Petroleum Corporation Limited
And sir, I would like to start by telling you that it's been a commendable performance especially if you look at the LPG under recovery what you absorbed. Sir, I have a question very clearly, as an investor on this point. I mean, if you see in FY '24, we reported a profit after tax of about INR24,000 crores, INR25,000 crores. And in this financial year, you've reported INR13,000 crores after absorbing about INR10,500 crores. So sir, is my understanding correct that how profitability including LPG because obviously, it's a control product so government will compensate you? It's just a matter of time. So can we say that now our profits have reset to a new standard, and we can assume that the profits which we reported over the last 2 years have sustainable profits over the next couple of years sir? That's my first question.
And sir, there is just one small point. When the Honourable Oil Minister had the press conference at that point of time, he said that the LPG prices will be looked at on a monthly basis. So can we assume that we are going towards a period where LPG prices would actually be controlled once its market aligned?
So sir, firstly, I mean, I would like to talk to you as an inve stor. Sir, I clearly see that you have done exceptionally well. You have made a profit of INR10,000 cr ores after absorbing INR7,100 crores of LPG under recovery. Now sir, it is -- of cou rse, we all know that LPG -- we also understand, sir, that LPG under recovery is borne by the government. But sir, clearly, I mean, one thing which you clearly must appr eciate from our point of view, is that this LPG under recovery is basically clouding the earnings overall for the earnings outlook or the earnings visibility basically for investors for us. I mean, sir, I would just like to highlight to you a few important things, which I really think are very important from an investor angle because, I mean, we spend a lot of time on metrics, on GRMs but the thing is that these things need to be priced by ma rket, right, which clearly is not being priced. Now sir, I just -- I would like to highlight this to you that t oday, the market cap -- I mean, the price of Bharat Petroleum or whatever you may say the market cap is exactly what it was back in 2017. Now sir, back in 2017, we used to make about INR9,000 crores of profit. But today, sir, we are well making INR20,000 crores of profit. So clearly, when public sector enterprises in India are going through a massive re-rating, okay, companies l i k e o u r s , w h i c h a r e t h e highest quality companies in terms of ROEs and ROICs are getting derated. Now sir, I mean, it is something of -- for which you should tak e significant importance is that today, we make INR20,000 crores and tomorrow with Project Aspir e, we make INR30,000 crores. But if the market doesn't get confidence on earnings an d visibility, then how does it help an investor, right? I mean, because today, ultimately, investors also want to make return. And today, if you see that if markets are not going to value ea rnings and we are going to trade at 7, 8-year kind of low prices, it is clearly saying that ther e is a disconnect between the reality of what you're doing versus the perception, right? I mean it clearly goes to show, right, because on ground level, you are delivering superb results. And there is no question on that front, right? But obviously, sir, the market needs to take cognizance of that and your PEs and your price-to- book ratios also need to adjust accordingly, right? I mean this is something which I really think that you, the ministry and ever yone should really give it a ver y serious thought because the right communication basically from you or the minister or the m inistry to basically investors will go a long way in rerating t hese companies because you are doing exceptionally well on financial performance. But sir, also, it is of significant impo rtance that markets realize this. So I really would much think if you can take a serious look at thi s, and please consider what I've said very seriously because it is in the best interest of all stakeholders. Now sir, coming to your one question on this Russian thing, whi ch has been exaggerated beyond imagination is, in fact, you see today also Mr. Trump ha s come and asked Russia to end the war. So sir, if the war to be end, then it would be saf e to assume that nothing on the Russian oil gets impacted and everything remains status quo?