NBIE Values your patronage- Vote for The Team in the Asia Money poll 2020. Click Here We maintain Buy on Indian Oil Corp (IOC) based on our trimmed TP of Rs146. Our buy call is based on: (i) improved outlook for retail margins under sub US$4050/bbbl (ii) refining and petchem margins are at trough levels and could revive over the next 1-2 years based on likely closure of capacities and iii) compelling valuations post the sharp 34% fall in the stock price in the last one year that has priced in worries over policy/volatility in margins and likely risk of increasing competition from private retailers/alternative fuels. IOC's 1QFY21 adjusted PAT at...

GAIL's Q1FY21 PAT was below estimates at Rs 2.6bn (80% YoY).

GAIL reported a beat of 25% on EBITDA at INR24.8b (+47% YoY, +19% QoQ). EBITDA was up 13% YoY to INR11.6b, with transmission volumes at 109mmscmd (flat YoY and QoQ), implying ~53% utilization. Gas transmission EBIT was up 15% YoY to INR8.9b. EBITDA was flat YoY at INR1.1b, with volumes up 2% YoY at 1.04mmt (102% utilization). LPG Transmission EBIT was also flat YoY at INR0.9b. EBIT was higher than expected at INR6.0b (+3% YoY, +29% QoQ), while volumes stood at 97.8mmscmd (flat YoY, +2% QoQ). Petchem sales were lower 18% YoY/QoQ at 174kmt; however, EBITDA at INR1.85b (~2x YoY) was due to lower gas cost. Nevertheless, realization was also lower 13% YoY at INR70/kg (flat QoQ). EBITDA came in at INR5.5b (+23% YoY, +74% QoQ), led by better realization. Transmission segment should remain a major contributor to EBIDTA (>50% share) and volumes are expected to grow to ~125mmscmd in FY22E.

NBIE Values your patronage- Vote for The Team in the Asia Money poll 2020. Click Here We maintain Buy on HPCL with a target price (TP) of Rs343, which we have arrived at based on 7x PE on our unchanged consolidated FY22E EPS. The standalone 1QFY21 results were a massive beat vs. our estimates. The adjusted PAT came in at Rs28.2bn vs our estimate of Rs14.8bn and 3.5x the PAT reported in 1QFY20. The beat was due to Gross/EBITDA margins coming in 181bps/352bps above our forecast, driven by robust unit EBITDA margin on marketing volume ~ Rs6351/te, as per our proforma analysis....

We maintain Buy on HPCL with a target price (TP) of Rs343 (+60.3% to CMP), which we have arrived at based on 7x PE on our reduced FY22E EPS (based on past average). This follows our earnings revision - cutting FY21E/FY22E earnings by 54.5%/21.9% post the 4QFY20 results call with HPCL management. The standalone 4QFY20 results were a beat vs. our estimates - adjusted PAT of Rs10.3bn vs our estimate of loss at Rs27mn. The beat was due to a steep tax write back of Rs15.48bn. The reported PAT came in at Rs268mn after exceptional loss of Rs10.03bn attributed to the impact of lockdown on inventory valuation. Reported GRM came in at minus US$0.1.23bbl, including refining inventory loss of Rs25.84bn vs. NBIE estimate of minus...

25 June 2020 The company posted huge inventory loss of INR185b (refining at INR162b and marketing at INR23b) during the quarter. Adjusted EBITDA for inventory stood at INR214.1b (v/s INR74.0b in 4QFY19 and INR50.3b in 3QFY20). Reported EBITDA came in at INR29.3b and forex loss for the quarter was at INR27.2b. Higher interest cost was offset by higher other income. The company revalued its inventory at the end of the quarter and recorded an exceptional item of INR113b (of which INR80b was refining and INR33b was marketing); thus, PBT came in at loss of INR136.1b. IOCL stated that total inventory loss of INR185b also includes revaluation loss. IOCL has moved to a lower tax rate and re-measured its DTL. Reported PAT stood at loss of INR51.9b.

Management expects to receive Rs3.4bn (Rs2.7bn for Ahmedabad Ring Road and Rs0.7bn balance from earlier 8 BOT assets) by 3QFY21E from Canadian pension fund for its assets stake sale. Further, the company is gradually ramping up execution across project sites with labour availability reaching ~80% pre-covid levels. With full labour force expected to be back post monsoon and commencement of three large EPC projects worth Rs36bn; company targets construction run-rate of Rs90-100mn/day from Oct'20. SADE is one of the most reputed and credible EPC companies in...

booked a profit of ~Rs170mn on its investment. Sadbhav Engineering (SADE) reported a mixed set of results with better operating performance, however higher effective tax rate dented profitability. sale of Ahmedabad Ring Road BOT project at a P/BV of ~2.5x (valuation as per agreement) is to be completed in FY21E. After a month's halt in construction activities due to nationwide lockdown, operations have now resumed in all project sites with labour force currently at 50-60% pre-covid levels. Company targets construction run-rate of Rs100mn/day with labour...

GAIL's Q4FY20 PAT was well above estimates at Rs 29bn (+266% YoY).

Healthy beat offsets risk to gas trading margin NBIE Values your patronage- Vote for The Team in the Asia Money poll 2020. Click Here GAIL's results were a beat across key segments, driving revenue beat of 25.9% at Rs177.53bn and PAT beat of 255% at Rs29.16bn vs NBIE/street estimates. During the webanalyst meet, management reported normal operations in petchem, LPG and HC and expects a revival in prices/margins. However, the company cautioned about some delay in the gas business returning to pre-COVID levels as the CNG market is down 50% due to the lockdown in key markets Delhi and Mumbai. The work on ongoing projects, including the...