Mangalore Refinery And Petrochemicals Ltd. share price target

Mangalore Refinery & Petrochemicals (MRPL) reported better-than-estimated results with an EBITDA of Rs11.3bn in Q4FY25 (up 9.6% QoQ; PLe:Rs9.7bn, cons est EBITDA: Rs8.4bn). PAT came in at Rs3.6bn (up 19.4% QoQ; PLe:Rs2.6bn, cons est:Rs1.9bn). Reported GRM stood at US$6.2/bbl with an inventory gain of US$0.42/bbl. Throughput came in flat QoQ at 4.6mmt. Average Singapore GRM in Q1FY26-TD continues to remain soft at ~US$3/bbl amid weakness in product cracks. While this near-term weakness is likely to persist, we believe...

MRPL’s 4QFY25 EBITDA beat our estimates by 34%, as reported GRM came in ~USD1/bbl above our estimates at USD6.2/bbl. Adjusting for inventory gain, core GRM stood at ~USD5.8/bbl.

MRPL delivered a substantial miss vs. our estimates in 1QFY25 due to a weak refining performance, with GRM/throughput coming in 32%/7% below our estimates.

While MRPL delivered a solid beat vs. our estimates, we believe its earnings
are set to decline from 1QFY25 amid weaker SG GRM QoQ. We are building
in a GRM of USD8/bbl in FY25/26, leading to an RoE of 18.2%/15.4%.

Singapore GRM improved to USD6.1/bbl QoQ in 3QFY22, led by an improvement in gasoline, ATF, and naphtha cracks. It stands at an average of USD5.9/bbl in Jan'22, as demand continues to outweigh supply. The macro environment remains strong. We believe the current high GRM is...

MRPL reported lower than estimated EBITDA and PAT. Refinery throughput was in line with our estimate at 3.2mmt (+27% YoY), implying a utilization rate of 86%. Continued concerns over utilization rates keeps margin under pressure, with higher OPEX (USD2.8/bbl in 2QFY22), impacting profitability. Reported GRM stood at USD2.22/bbl, with core GRM at USD1.69/bbl (est. of USD1.5/bbl and negative core GRM in FY21 and 1QFY22). Consolidated/standalone net debt stood at INR244b/INR187b at the end of 1HFY22 (up from INR238b/INR182b at the end of FY21.)...

MRPL's capacity utilisation improved QoQ with increasing demand and surpassed pre-Covid level. However, capacity utilisation reduced during the current quarter (Q1FY22E-TD) due to declining demand. On the business front, MRPL has plans to augment its capacity from 15 MMTPA to 18 MMTPA over the next few years. However, last expansion project to increase complexity as well as capacity did not achieve desired results. Global product spreads have not fully recovered yet and will continue to affect refining margins. MRPL's previous investment in OMPL have not paid off....

The nationwide lockdown due to spread of Covid-19 has reduced capacity utilisation of the company and will impact its near term performance. On the business front, MRPL plans to augment its capacity from 15 MMTPA to 18 MMTPA over the next few years. However, the last expansion project to increase complexity as well as capacity did not achieve desired results. Also, weak global product spreads will affect refining margins thereby affecting profitability. MRPL's investment in OMPL has also not paid off. It continues to be a drag at the consolidated level. We downgrade the stock from...

Crude prices witnessed a sharp decline in March due to spread of Covid-19 across the globe and Opec deal failure. A likely increase in oil output by both Saudi Arabia and Russia from Q1FY21E and lower demand are expected to lead to a sizeable oversupply in the oil market. Subsequent low oil prices are expected to significantly affect ONGC's profitability....

MRPL reported a weak set of Q3FY20 numbers on the profitability front. Revenues increased 9.7% QoQ to | 16744.6 crore on account of higher oil throughput. Oil throughput at 4.1 MMT was up 11.4% QoQ. Core GRMs disappointed and were at US$2.7/bbl in the quarter vs. US$3.6/bbl in FY19 and US$6.5/bbl in FY18. EBITDA for the quarter was at | 299.7 crore....