Hindustan Petroleum Corporation Limited (HINDPETRO) Q4 2026 Earnings Call Transcript

Ladies and gentlemen, good day, and welcome to the Hindustan Petroleum Corporation Limited Q4-FI26 Earnings Call, hosted by Antic Stock Broking Limited. As a reminder, all participant lines will be in the lesson only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call? Please signal an operator by pressing star and zero on it at stone 4. Please note, this conference is being recorded. I now hand the conference over to Mr. Vartarajan Sivasankaran from Antique Stock Broking Limited. Thank you and over to you, sir.

Thank you, Sophanali. A very good afternoon, everyone. It's my pleasure to welcome all the participants on this call and the top management of HPCL. This afternoon, for the discussion on the fourth quarter results. From HBCL, we have Mr. Vikash Kaushal, Chairman Managing Director, Mr. Rajneesh Naran, Director Finance, Mr. S. Bharatan, Director Refineries, and Mr. K. Vinod, Executive Director, Corporate Finance. I'll under the floor to Mr. Vikash Kaushal for his comments.

Thank you, Madhul Jan. Good afternoon, everyone. Pleasure speaking to you on this call. As you all know, we declared our Q4 and the annual results just a short while ago, and we thought this would be a right time to do a call early today itself. We wanted to beat you before your writing the first reports and asking questions. We wanted to give you data so that you can write the informed reports. Before we start the conversation, I would say, like in the past, all the detailed results, investor presentations are both reported to the stock exchanges and also on our website. So we are not going to make a formal presentation like in the past, but I'll start off by talking for a few minutes about how we see the situation, about our numbers, highlighting a few points, and then remaining time we will use for an open question-answer session. So just to get started, we all know the turbulent times we live in, the geopolitical uncertainty is all around us, going on for a fairly long time. The crude prices have gone high, and more importantly, they are very volatile, sometimes shifting $8 to $10 in a day. Product availability or crude raw material LPG availability has been challenging with the supply chain disruptions. And Forex, we all know, has had challenges in terms of rupee depreciation. On top of it, being in a business which supplies energy to the millions of homes and millions of vehicles, we get very impacted by fears and perceptions. So in some geography, someday people think there is going to be shortage of fuel, and then so many people turn up at the pumps, etc. So that's been the life we have been living in the last. Seventy-odd days. Our focus as a management team has been in terms of a few things. First, really ensuring that the supplies are met. Our teams have worked incredibly hard to make sure whether it's LPG supplies, liquid fuels, all kinds of supplies are met, the retail stations are working there, LPG is getting home, etc. That has taken a lot of time. But we are very happy that we, along with other companies in the sector, have maintained the supplies. Second question which keeps on coming and perceptions which keep on getting, oh, crude is going to run out. I can assure you that we as a company and other OMCs also have fully secured the crude for a long period of time. And we don't see availability of a crude as an issue. Of course, pricing, we all know, has been a challenge there. LPG, there's been a very nice pivot in the country on LPG from... A situation where we were very dependent on Persian Gulf on imports, and those import sources dried out rather quickly. We've been able to increase domestic production. We've been able to increase alternate sourcing, etc. And as we speak, we have a very good forward coverage on the supply availabilities. I can assure you, those of you who are connected with LPG cylinders, your kitchens are not going to go dry. You will get your cylinders. In time, of course, you'll have to wait for the 21-day cycle, which is the rule now. This has all required a lot of hard work, and before I proceed further, it will be a remiss on my part to not thank my teams in HPCL, who have done incredible work over the last 70 days of this crisis. It takes a lot of toll to supply those cylinders and keep those pumps working in this situation. Also, I would call out a very good coordination between all the oil companies. We have not let each other down and anybody needs product. We have been helping each other. And also, there is a very active guidance and interactions with the Ministry of Petroleum and Natural Gas and other government stakeholders to ensure that there is continuous supplies of the product in the country. All people have worked very hard to solve this. Of course, we hope normalcy comes back very quickly. And some of us get some well-deserved rest and some chance to sleep. With that prelude, let me come to what you are waiting for in terms of our views on the results. I'm excited to present the results. After every quarter, we have come and talked on this forum, talked to all of you, and many of you have otherwise reached out, and we have been very open in giving time and also very open in sharing our views and also listening in to your feedback and suggestions. You'll recall by quarter three, we had clocked 12,274 as standalone profit. This was up 206% from last year. So you knew we were on a good trajectory for the year. We carried that strong momentum into January and February also and locked in good numbers in both those months. In March, the crisis hit. Obviously, all kinds of volatility happened. And we had to take a lot of mitigation measures, both in terms of the physical aspects of the business, but also the financial aspects of the business. All I can say is team HPCL was very swift to react. Balancing actions with financial prudence. Now, not all of those we will discuss on the call, but I would say every inch of effort was done and every ounce of energy was extracted to make sure we are balancing the supplies with also managing financial prudence. It's not just for supplies. We are not letting go of all financial prudence there. You all know that our business has a lag effect. In March, we pretty much consumed the Feb price crude. So this mitigated the impact for March, and this coupled with many other factors have helped us in salvaging a strong performance and decent performance in March. That coupled with the January-February momentum resulted in strong quarter four numbers. Our revenue for quarter four is 1,23,000 crores, if I remember it correctly, 4.5 percent. That was marginally because of the price increase in some of the segments, the industrial consumers, and also some volume increases. The fact for the quarter is 4901 crores. It's up, if I remember correctly, 46% or something of that number. I don't remember it offhand, but it's a reasonably large number. So, part which is exciting is when we look at the year as a whole. Our PAT for the year standalone is 17,175 crores. This is 233% of the PAT of last year, swapped 133%. And the previous best ever HPCL had recorded was 14,654 or something. So, this is 17% higher than the previous best HPCL has ever recorded. The consolidated PAT was 18,047 crores. Two of our refinery investments, HMEL and MRPL, contributing strongly, especially in the fourth quarter. We are excited about this performance. All through the year, we have been talking to you very transparently about what we are doing and many things we are trying to do into our business. I'll talk on that in a minute, but let me give what these numbers lead to. I think you would recall, and many of you had questioned us on our debt equity for a period of time. We have been carrying high debt equity for a period of time. At the end of H1 of FY25, our debt equity was as high as 1.63. At the end of the financial year, it had dropped to about 1.38. But with this strong performance this year, it has dropped to 0.8. This is well below the guidance we had given to UF at 1.1, and then towards the middle of the year, we had revised the guidance to close to 1. So we have managed to successfully deleverage for the last year, and I'll give you the breakups on how we think about it. What has driven this performance? I once again say it is team HPCL which has delivered this performance, and as a management team, we are very proud of our team, which has delivered this incredible performance. Going into some of the factors, and, of course, market momentums contribute to it, and there were pricing regimes helped in the last quarter. Many of you were part of the Dan Leeds meet we have done, including the one where Honorable Minister spoke about it. So that has contributed, but there are six key factors in which the management drove, which have also contributed to the strong results. First, our Cost Takeout Program Summary Team. We all know that, we've been talking about that in every analyst call. We had given a guidance of 1,000 crores, which we later revised to 1,500 crores. The actual achievement for the year was 1,691 crores, of which 947 was one time, and 744, if I get the math correctly, are recurring. The recurring one has been baked in into our... The second key aspect was actually translating the savings into P&L. Sometimes we do this large program show savings, but it does not show in the numbers. In our case, you can very well see in the numbers, and I'll just give you two data points. First, if you look at OPEX as turnover, in FY25, we were at 1.54%. In FY26, we have come down to 1.45%. It's a 0.09%, which on the base on which we operate is a phenomenal number to get in a year. We might have got even better, except for that March, a lot of extra costs had to be incurred for last minute movements, etc. If I just talk in terms of OPEX per MT, in FI25, the number was 1438 per metric ton, and this has dropped to 1344. That's the hard cash which has been conserved in the business. You can multiply it with a huge volume, and that's where the savings and the uptake on the numbers have come in. Third, we had a very tight control on the CAPEX. Three, four aspects. First, we obviously had rough and HRL in full swing, so that capex, we were funneling all the capex which was required there, but we had curtailed and phased out a lot of other capex. And on the curtailment, also, we went very slow on the capex in the first two to three quarters of the year. It's only towards the end of the year, we allowed some of the, what I would call as discretionary or less important capex. This allowed us to carry or lower our debt throughout the year, and also be very prudent in where we spend the capex. Fourth, very tight management of borrowings. March 31, 2025, we were 63,323 crores on Total debt, this was on standalone, not consolidated. March 31, 2026, we have dropped it down to $47,599. That's an incredible drop, and there are two, three reasons behind that entire thing. Later on, we can talk about the short-term borrowings, lockdown borrowings, which is there. But from my vantage point, very astute working capital management is one of the reasons behind it. If I remember my numbers correctly, we probably shaved off around 8,500 crores from our working capital between the last year end to this year end. That obviously lowers the borrowings. And then as the crisis went out, our teams were very sharp in managing the situation. Including things like how much credit we have in the market, managing to get hold of that and significantly reducing the outstanding credit, etc. All the steps which are in management's control were exercised. The fifth element was lower interest. Last year, we carried an interest of 3,914 into our P&L that dropped to 3,337 during the year, literally around 600 crores less. This is lower due to two counts. One, lower debt burden. As we started performing better, we started lowering the debt. And second, we took action in specific refinancing of debt, lowering some of our – we managed to lower our forex exposure by maybe $250,000, $300 million during that period. All of that helped in tightening the numbers towards the end. Last but not the least, very strong operational performance, refining best ever. Both our refineries put together produced more than 26 million tons, highest ever, 3% growth over last year. And on marketing, it was 51 point something of sales. You can see it in the investor presentation, again, a 3.3% growth. All I would say is during the year, we focused on growth on profitable segments. We did not chase growth. At all costs. So our growth numbers might be a tad lower than what you would see for others, but that was a very conscious call of not chasing volumes, but chasing valuable growth. These steps are a culmination of a lot of hard work by the entire team, and over the year I've seen the team push the boundaries on multiple dimensions. Once again, I'll thank the team for all the effort there. I'm sure there are some updates you would want to know before we throw it open for the progress. Let me preempt some of the questions. You would surely have a question around rough. We had commissioned rough on 3rd of Jan. It is progressing in stabilization, but at a slower rate than what we would have anticipated. We did have a, I would say, a situation where there was a clogging of catalysts in the vessel, so we had to take a shutdown, restart it, et cetera. We are learning how to handle that big beast. The unit is now, as I speak, back on stream, and now it is ramping up fully. We are expecting full ramp-up in the next month or two, and it's already giving smaller benefits to us, but I would expect more incremental benefits to start coming in. Towards the end of this quarter or early part of next quarter. So from a financial perspective, it is not equitative in the numbers. Those of you who run Excel sheets very passionately, you can take that block and say that is going to come over and above the numbers which we have delivered there. I would expect the numbers to kick in in quarter two. On HRRL, you were aware that we were very close to commissioning or getting the project started with an event scheduled for dedication to the nation on 21st April. Unfortunately, there was a fire on 20th. It happens in these businesses. As we reported to the stock exchanges, there was a vacuum residue leak in the CD2 unit, which caused a localized fire. Thankfully, it was brought under control very quickly. It was very localized. Just for context, it impacts six heat exchanger bays in the refinery, and last time I was asking the refinery who was telling me that there are at least 600 to 800 such heat exchangers in the refinery itself. So it's a very small portion when you see on the map, but obviously it delayed the kickstart of the thing. The good thing is that it is getting back on feet. Other units are in the commissioning cycle. We actually have produced... and sold LPG. In the trial runs of CBU, we have run at least one VLCC of crude already and produced intermediates, and hopefully in this month, we will start producing diesel and MS and CBU will also be back on stream. So we are hoping towards that and aiming towards Achieving a COD on the project shortly. Initially, the refinery would operate at around 60% capacity. We are expecting that run in June itself. We have ordered crews, etc. accordingly. And from quarter two, we are expecting the refinery section to ramp up fully. And then slowly, we will add PET-CAM. Anyway, PET-CAM right now, under control order, we have to produce LPG rather than propylene downstream. On Chara, which was the other third project, the port was able to complete 90-95% of the breakwater. I think around 18 or 1850 meters of breakwater has been completed. About 100 is left. With this, we expect the permission to run the asset at full capacity. We are starting to bring in more cargo. Of course, right now everything is disrupted with the supply chain. Last update on the project side, 2G ethanol, which has been going for some time, we have achieved mechanical completion by 31st March, and we are hoping to start that project in the next two to three months. It's technologically a big challenging project, so we don't expect massive value from a financial perspective, but nevertheless, it will be an important project to start. Just closing out on the forward-looking views, quarter one, we expect it to be very tough. You all are aware of the situation. The crews are very expensive, product prices are low, and everything is quite volatile. As of where we stand, there would be... Losses in the first quarter. Enough of that has been said in the public domain. I think just yesterday at a seminar, Honorable Minister of Petroleum and Natural Gas also talked about it, and earlier in the week, Honorable Prime Minister also talked about the fact that oil companies have been under stress given the current numbers. The numbers would depend on multiple factors, and we are not going to give any guidance on this because it's just too volatile to give a guidance. As a management team, we are very focused on the controllable aspects, mitigating the impact where we can maintain the supplies, and also getting ourselves ready so that we bounce back very quickly when the business environment turns around. What gives us confidence is our balance sheet strength. The strong financial year improvement in the balance sheet gives us the headroom to fight the current situation. Even as we manage that, we are steadfast on our agenda for the next financial year. We have been talking to you on these things, but I will very quickly, in a minute or two, just talk about it and then open it up for questions. Samrithi 2.0, we had said that we will give guidance in the first analyst call. We have withheld that guidance because in this volatile environment, we find very uncomfortable to pin down a number there. However, we are focused on this. The first wave of samzidhi we have done in-house. For this wave, we have selected a consultant. Because we are now getting on to hard-to-achiever section. But hopefully in the second analyst call, we'll be giving you guidance on what we are looking at. But I want to leave everybody with a message that we are going to continue on the cost journey. And once the whole turmoil settles down, we'll get back on to the cost reduction curves again. Second, on digital front, we are making considerable progress, driving towards efficiencies, capturing in the efficiencies and ease of work. A lot of parallel initiatives are going on, and you would see leapfrogging of SPCL on this front. I would encourage you to start visiting some of our refurbished retail outlets, and you'll see that slowly we are starting to make a difference. On the refinery side, HRRL on getting on board, getting it stabilized is one of our topmost priority, and then getting PetCam rolled on. And Ruff, we need to start getting in the benefits, and we are confident that having gone through the learning curve, we will get to the benefits soon. The next area we want to talk about was trading or trading. Buying of products and selling of products, that has been an increased focus for us over the last few quarters. We have diversified our crude buying. We have brought in flexibility. We have brought in a lot of agility. Many of that 900 crore savings actually came in from some of these smart moves on trading. So we are gearing up and also gearing up a bit towards product trading because there will be times when we have surplus products. Retail, we are already on the part of strengthening our brand. We had launched Abu Day last year. It did not give us as much of throughput increase, but it gave us a lot of learning. Having learned from that, we have launched an Abu Day 2.0, where we are now learning from what we could not achieve last year. We are aiming to achieve that this year. And in line with our capital cycle coming to an end, we are increasing our focus on renewables and gas and making sure both the investments we are made are paying for themselves and also thinking of the next wave of investments. Also, last point, coming to close on this capital cycle, we are starting to think of our next five-year agenda. Just to conclude, over the last year, we have started aggressively on our transformation journey. We have taken many initiatives. Some have succeeded, some have failed, but we have learned in this. We have demonstrated our capabilities to all hard-news critiques like you and the external world, but more importantly to ourselves, because the moment we know of our capabilities, we can win further. Team HPCL has a hunger and desire to win. And we will hope to continue this strong performance. We are on a strong trajectory and confident on delivering to our shareholders, even despite all the crisis with us. Thank you for your interest in us. Before I open it to questions, I also want to take this opportunity to thank my fellow director, Rajneesh Ji. Many of you have heard his voice. As some of you might know, he's... Superannuating after a long tenure in HBCL, including many years at the helm of board of HBCL. Many of you who have followed HBCL for a long time remember his 40,000 crore EBITDA slide. Well, I was joking with him earlier in the day that every 34381 has consolidated EBITDA, which is a fitting tribute to his contribution to HBCL. With that, let me thank everybody for their participation, and we will throw it open for questions.

Thank you very much. We will now begin with the question and answer session. Anyone who wishes to ask a question may press star and 1 on the touch-tone telephone. If you wish to remove yourself from the question queue, you may press star and 2. Participants, you are requested to use answers while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue is answered. We have the first question from the line of Probal Sen from ICC Securities. Please go ahead.

Thank you for the opportunity. Good afternoon, sir. Congratulations for a very strong set of numbers. I hope I'm monitoring.

Yeah, Probal.

Yeah, sir, just a couple of questions. Firstly, on the supply situation, you did mention that, you know, there's no need to sort of, you are fully secure for a comfortable period of time as of now. Just wanted, if possible, can any granularity be shared in terms of which are the sources that we are sort of tapping at this point of time? And from HPCL's perspective, you know, any time period you want to attach to, you know, for how long we are secure, I'm assuming, of course, that the conflict continues to drag on through the first quarter as well, then how are we placed and what are the geographies we are targeting? For alternative supply. Uh-huh.

Okay. Any other question?

I have a couple more, sir. Yeah, yeah. So, the other question was, did inventory gains actually help the numbers this quarter? And if so, if it is possible to quantify. And the third question was, what was the LPG loss? You've given the net negative buffer. Just wanted to understand the LPG loss that was there in this quarter. Those were my three questions.

Thank you. Sure. Thanks, Prabhal. As always, you win the early bird prize. This time we have to send you a nice hamper for that. But on the supplier situation, see, dial back to February of 2026 when there was no crisis, what would be the crude I would have secured? I would have secured crude for two months of running. That's all I would have secured. Of course, we would have had term agreements and we would buy spots there. So at no point of time, barring a few days here and there when markets were there, but for most period of the time, we have been having two months outlook for crude all the time. So the normal situation which I have had on crude prevails. The challenge has been that in the past, We were relying, say, half on term, I'm just saying half as a figurative number, not to be quoted exactly in an Excel sheet, but we were relying on half to term contracts and half on spot. Of late, given the challenge that a lot of term contracts were from Persian Calf, we had to rely a lot more on spot cargo, so we have to do our spot purchases a lot more frequently, but at no point of time. Except for the first three, four days of the crisis in the first week of March, when there was the shock and awe of what was happening, were we not covered with roughly two months of inventory, which is normally what we carry, two months of secured supply. And right now, we are already in the market, starting to lap up cargoes for July, and we are getting enough cargoes. So the cost is more expensive. In terms of geographies, well, this was not a time to be either optimizing the crude which you could run in your refinery, and that probably also impacted our GRMs to some extent, because in either situation, we would have run a particular mix of crude, but right now, we were running crudes which were available, rather than which were the most optimized for me. So we have not bothered a lot on geographies, which we are looking at, but if I just give you broad trends. Pre-crisis, give me one second, I have that number written somewhere. Pre-crisis, we were buying, obviously, a lot from... Russian Gulf and, of course, from many other places also. But post the crisis situation, significant amount of Russian crude also came into the picture. And, in fact, very early in the cycle, we picked up a large chunk of – all CUMCs together picked up a large chunk of Russian crude. So things like Iraq has gone down very considerably July, Jan, Feb, we ran a lot of... On those months, 20-25% of my purchase was Iraq. It has gone down considerably because nothing is coming out of the Persian Gulf. On the contrary, Russian crude was available in the market on seas that was procured. And there was a lot of other crude, even African crude went up during this period. Some of the, we also got crude from U.S. Some of you would know that we even picked up a cargo or two from places like Venezuela. So that's the broad shift in the numbers, which we will. Have had. I hope that answers your question. On LPG, to be fair, it shifted from a lot of term contracts in Middle East to actually a lot of spot cargos where at the times you are even buying. Spot cargoes on the sea in the market where you're less worried about whether it was coming from geography or geography, but more on when it can reach my shores. But that shift has definitely moved away from Persian Gulf to other locations. Now parts of that world is also registered, and some of the cash from Persian Gulf is also coming out in different forms. On your second question on inventory, maybe I'll ask Director of Finance to give his opinion.

Yeah, it's true that there were elements of inventory gain which are sitting in our books of accounts, but to be realistic, considering the fact that there have been so much of volatility plus the accounting adjustments because of the NRV reductions and all, We would not like to share the numbers once the stability is there as regards the pricing and it returns back to normal. I think that would be the right time for us to share the numbers so that you can accordingly put it in your model. Whatever numbers I would give otherwise would lead to some incorrect adjustments in your model. So I will refrain from giving the inventory gains or losses numbers there. But coming to your LPG under recoveries, the full year under recovery was around 5200 crores, and for the quarter, it was around 1350 crores. But against this, not against this, but we have also got around 5 installments of the LPG compensation totaling to around 3300 crores during this period, in this current financial year. Thank you.

Got it, sir. Thank you very much, sir. I'll come back if I have more questions. Thanks for your time and all the time.

Thank you. We will take the next question from the line of Netan Tiwari from Philip Capital, India. Please go ahead.

Hi, sir. Good afternoon, and thanks for the opportunity. So, sir, there have been a number of figures which are there in the market in terms of the kind of combined losses that... All marketing companies are currently incurring a broad ballpark respect around 1000 crores. I just wanted to understand what's that number for us in terms of our daily rate of loss. That would be my first one.

Yeah, thanks. I think that's the question on mind of everyone. But as I said in my opening remarks, we are not going to give a forward-looking guidance on this. I'm also fully aware on what kind of numbers we read the press every day. I think Honorable Minister from the podium at a CII conference yesterday talked about We have a directional number for all the OMCs there. Obviously, he does not know the exact numbers which we have because being listed companies, the numbers are with us only. But all I would say, we are incurring losses right now, and we are doing our best to manage the losses there. And what could be the order of magnitude? And I'm sure at the right time, right decisions would be taken. But we will not be giving forward-looking guidance because being a listed company, being financially responsible, it becomes very risky to give guidance in a volatile environment like we have right now.

Fair enough, sir. I'll take that. Secondly, sir, my query was with regards to procurement and days of inventory. So, you said that, like, you know, you mentioned about crude that we have covered for coming two months. So, what's the situation with respect to key products? How much of product inventory are we holding as of now in terms of days of holding for petrol and diesel and also for LPG? If you can help us understand that. And second-level procurement fund when we are reaching out in the spot market. So is that through traders? I mean, how does that procurement work? I mean, do we have basically a say in terms of which geography we are going to procure from, or it's just a tender for a trader to fulfill, irrespective of where it is getting fulfilled from?

I think on first point on days of inventory, let me keep it very simple for all of you. At a macro level, the supply chain on liquid fuels is roughly moving similar to what it was pre-crisis. What do I mean with that? Pre-crisis I would always book. If I was sitting in middle of May, I would be working July cargo. That is what I am doing right now. I have my June fully covered. For WISEG, we always have 45 to 50 days fully covered, and for Mumbai, we would have 30 to 35 days covered, because that was a typical cycle. All through this period, barring a day or two here and there, we've had this fully covered, and we are very comfortable on the crude supplies. We don't see an issue on the crude supply at all. LPG, there were challenges there, but with the passage of time, doing multiple things, and also depth management at the country level on LPG by increasing production, managing or directing the supplies, and also some amount of demand sampling. That situation has been managed, and there is, on a daily basis, across all OMCs, across the ministry, we look at coverage. Are we comfortable? We are very comfortable on... The coverage we have for LPG available with us. There is going to be no shortage in May. There is going to be no shortage in June. And as July comes in, there is going to be no shortage in July also. Anyway, we always looked at 45 to 50 days there. On the product availability in my supply chain, that's roughly similar to what it was. I would carry sometimes, if I can remember correctly, 30 days roughly I would carry. And depending on where I'm on the pipeline or off-pipeline, that marks vary. But if I look at the quantum of inventory we are carrying, Barring the operational variations which should happen some days, it could be a few higher or lower, they roughly have been carrying the same inventory from the product perspective. So nothing much has changed on that except prices.

And on the procurement front, so why I ask that question is that because there are a number of reports which have indicated that there's almost a 11 million barrel per day for all of crude oil production globally, and I mean, the procurement actually is. A function of both time and the shortfall. So while like, you know, a deeper shortfall in a short period of time is manageable, but as time progresses and if the shortfall continues, incremental procurement can get difficult. So I just wanted to understand that when you're procuring crude from the spot market, how is it like, you know, how the value chain works and you reach out to a trader or you reach out to a market directly, how does it work? If you can explain that, that would be helpful.

I think I'll again repeat what I've said twice in the call that we are fully covered as a company, and as much as I know about the sector also, we are covered on it. In our earlier analyst calls, we have been saying that we buy crude from 41 different countries, and that might even, this is only HPCL, other companies might come from a large market, or as a nation, we buy that. Any year, we run multiple, in our refinements, we can run anywhere close to 180 to 190 type of crude, and it's not that crude has disappeared from the market. Enough of that is available. So, there are multiple processes for buying crude. There are term agreements which we have. We have been doing it as a firm also. Even in this current situation, there are some term agreements on which crudes are coming. If I had a term agreement with any African country, that is not impacted by this thing. If I had a term agreement with a South American company, that is not impacted in the current crisis. That crude is coming. Then there are spot cargos, all kinds of spot cargos which come in. Some, as you said, we buy through a tender. There are some when you go to market, there are different ways of inviting things. So as in when we have a need and roughly once a week we go into the market, those of you who are close to the trade can look at Kepler data and all those kind of things. Unfortunately, we have every transaction. Sometimes you do a transaction and next day it is reported in the press what price we bought it. A lot of people, journalists, have nice ways of getting it. But if you track Kepler and all, you can figure out when do we go to buy, when does IOCL go, when does BPCL, when does Reliance go to buy. All of us have been going very regularly. All I would say is the instances on spot has increased right now, because like we had some term contracts in Persian Gulf, which are not able to supply consistently right now, hence we have to buy a lot more from spot. But that's not a part of my business I get really worried about. Of course, we are very... We keep an eagle's eye vigil on it because any movement up and down, even try to time out, should I go today? Is something going to happen tomorrow? All those things we try to do to mitigate the impact. But I don't worry on the supply side of it. As I said, twice or three times I've now said on the call, we are fully secured on the crude supply. We are very comfortable on the LPG supply. Sure, sir.

Thanks so much for taking my questions. I'll get back in the queue for further questions. Thanks.

Thank you. We will take the next question from the line of Sarthak Tita from DSPAM. Please go ahead.

Hi, good afternoon. Am I audible? Yes. Yeah, congratulations to the team for the good set of numbers. I just had a couple of questions, both revolving around CAPEX. So, sir, you highlighted on the opening remarks that CAPEX you have curtailed a bit in this year. And if I see the presentation, we have maintained the number of around 77,000 crores for the five-year period from FI24 to FI28. So, and in FI26, I believe we have disclosed that we have spent 15,700 crores. So, all these numbers to set aside, and the current volatile market in Q1, also you mentioned the weakness. How do we see the capex going forward? Will there be a significant downward revision? Because I think that will be warranted. So, how should we think about that?

Yeah, I think all good managements will respond to the stimuli which come from an external environment. Now, when I said we curtailed CapEx last year, maybe it did not show much in the numbers, but you won't know what our internal plans were. Maybe they were higher, they were brought it down to a level. And overall numbers also do not show at what points of the time in the year I spent, because that also has an impact. And third, we should not forget that we were already committed to a large CapEx stream, which is going. Now, forward looking, if I look at where I am today. Obviously, I'm spending on HRRL, whatever needs to be spent to finish that because I have to commission that project. So whatever CapEx has to go in there is going there irrespective of what else is happening there. But wherever I have discretion on starting a new project, I'm taking a pause and saying, okay, let's come back to this decision after 8 weeks or 12 weeks. A lot of our CapEx, as you can know from a breakup, is things like modernization of our retail outlets. Sometimes we have a pipeline to lay. Sometimes we have a depot to renovate. Sometimes we have to do a renovation in an emergency because there is a safety thing. So if there is a safety emergency, we are going ahead with that capex. But if there is a discretionary thing that, okay, we have a choice to start that renovation three months later, we will postpone that decision. So those are judicious calls the management team is taking. As of now, I think, I don't remember the number offhand, but our projected capex for this year is... Slightly lower than last year. But that does not mean that we are wedded to that number. If war ends tomorrow and we get into a boom cycle, we might do more than that. But if the war continues for three more quarters, we obviously will do less than that. That's the response strategy I would have on this. Having said that, every committed capex and anything which is run towards completing our past capex is being incurred as we speak.

Understood. So, fair enough. This was a very elaborate answer. Thank you. So, secondly, one small question. You mentioned about the incident at Barmir and a very few number of units that were impacted. Any extra CAPEX that we had to incur due to this or that will be a very small figure?

I just said six. Heat exchangers in a refinery which has 600 to 800 heat exchangers and thousands of other things was impacted. There was a small amount for refurbishment and there will be some amount of I think insurance claims and all those kind of things around it. So it's even if there's this minor thing extra, it will be rounding off error in the entire thing. It's not, it's a very localized thing. It's just that when the physicality of that happens, you have to take some, there is some time of downtime, which would be there, and unfortunately for us, it happened on a day when, one day prior to the inauguration of the plant, which was unfortunate, but we have to live with that. We will be bouncing back very soon on that. I said earlier, and we have given it in guidance to stock markets and the stock exchanges, that we hold the guidance which we have given to stock exchanges, and if there is any further update on this, we will duly inform the stock exchanges. As of now, I would say we have visibility of coming out with, if I remember the exact words we have said, in the second fortnight of May, we will start producing some products from the refinery.

Okay, got it. This was helpful, sir. That's it from my side. Thank you.

Thank you. We will take the next question from the line of Mayank Maheshwari from Morgan Stanley. Please go ahead.

Thank you for the call, sir, despite the tough times. Can you just talk a bit about, in terms of crude sourcing, what you are seeing in the market, you can be generalist, you don't have to be very specific to HPCL, but can you just give us an idea around when you are going in the market today to source crude? What kind of premiums, insurance, how they have moved over the last few months? And how are you kind of thinking about that now managing it as you are sourcing for July?

Yeah, Mike, I think that's a good question. At the highest level, I would say in every element, there is a volatility in it, whether it is price, whether it is even insurance premium. This will be an example of insurance. Obviously, insurance premiums have gone up. That's a known fact. Earlier, we would have taken a long insurance policy. Now, sometimes we have to go cargo by cargo on some specific insurance policies. So, that obviously increases the times involved. Then there is some movement-related aspect, especially anything coming close from Middle East. You have to be doubly sure on movement. You have to keep track of movements. Of course, things coming from other sides are actually moving quite normally. When we If we go to spot, are we seeing? Lesser number of cargos? I don't think we are seeing lesser number of cargos. Obviously, there are certain grades which are not available because they are curtailed or they are very little available. But if in a particular inquiry, 40 people would have participated earlier, actually roughly around the same number of people are participating. In terms of quotes from the people, we definitely see a lot more variation. In the past, the quotes would have been, say, If the delta was x earlier between the highest and the lowest, sometimes these times there are three x deltas. What also happens, Mayank, in this is there are times when you can actually be very opportune on this. It happened with us last two, three weeks ago. We sourced a particular cargo. Just as we finished the internal approval on that cargo, an event happened outside where we immediately thought prices will fall down. Our team reacted immediately. This was after we had given the formal approval and approved, and with the same parties, they could negotiate a discount, a significant discount, a good single-digit dollars in terms of discount. And that's obviously need saving. So the need for agility in cargo buying has definitely gone up. So even as a state-owned enterprise, I can't always say that, oh, I will set back into my process, I will give you a tender, you give me a response after 24 hours. We've had to change processes where our decision-making body is sitting right while our trading team, just behind the trading team and giving them a decision on the spot. So that's the kind of reaction and agility which is needed. I think in moments like this, agility also gives you opportunities, and wherever possible, we have tried seizing those opportunities. I don't know whether I answered your question, but that's how I see the market. If there are more specific details, we'll be happy to put you in touch with our trading desk for further questions.

Sure, sir. So the second question is more related to, and this is what you talked about, I think, Parikhal, which is the digital ascent thing that you put it on your side tag. I think you have been, I think, a year and a half, two years back, you guys talked about on AI, and now you're talking about generative AI in your processes. Can you talk us through of how you're kind of getting it through? What is the story that you're kind of pushing, and what has been the impact in terms of cost savings, if at all you are even thinking about these things into the cost-saving focus that you guys have?

No, thanks. Let me just, I'm trying to figure out which specific slide my team has sent. It was 41 slide, no, number 41. Okay, Parikalp. Okay, Parikalp has been... On the right-hand side. Next time, we will give you an updated version of this. My apologies, we should have had the latest version on this. In some ways, Parikalp was the program which HPCL ran for a long period of time, and obviously, we did some amount of movement on digital front. In the last six to nine months, while we have not changed the name of the program, actually, we have not even given it a new name, we have re-energized our digital effort. So, what did we do? There were a lot of different initiatives which had been done. Some good, some not so good. We had done a big SAP change, rollover from legacy system into SAP. So a lot of things had been done. But we got one of the best consultants to work on a North Star product and give a very deep assessment on where we are. This happened in the last, I think, third quarter of the year or fourth quarter, somewhere around November, December. They have looked at all our business and given us A frank as is assessment and a roadmap ahead. Parallelly, we have formed a large digital transformation team which reports to Director of Finance and me, basically sits centrally. It has now been augmented to 35 people. We have handpicked people from across the place who are now tasked in a three-year timeframe to move forward on the digital initiative so that there is This is the central coordination of all the digital initiatives. What are the themes we are doing? Three or four themes we are doing. One, bringing in digitization, automation in many parts of our business. Like I'll just give you an example. Many of you would know that about 85% of our retail outlets are connected real time with our central service. We have a system where we can actually see how much petrol or diesel is infilled from which nozzle in which of my retail outlets. I can see that sitting in my office, actually, if I have that much of time. However, there were two things we were doing. We were not leveraging the data enough. And second, we were stuck at 85. Now, just to give you a theme, one thing we have said in two months, let's get it down to all the legally operating. By legally, I mean to say there are some places where you have disputes with the pumps. But anything which is kosher in our system, we are connecting it immediately. Second, we have formed in a team which is looking at data. You can imagine in this current pricing regime, there is proliferation of diesel from retail outlets to industrial customers. We are catching those guys using data. Every evening, reports are published. Mails go out. Sometimes dealers are asked for show causes. Sometimes they are suspended. If we find they are doing transaction which is larger than what a retail outlet. My system can configure, oh, if it is greater than so much liters is filled in, there is a challenge in that. That's an example which we are doing. So, saturation, completing the setup is one thing. Second, there are parts of our system which are not connected by IT, like our supply chains are not fully connected by IT, some terminals, etc. I can't read what is the capacity on all my terms. Thanks. I can read it at the terminal. So those kind of interconnectivities we are doing. Third, we are using technology to drive inefficiencies. And I'll give you an example from our refining setup where in many of the units in the last 12 months, we have done the RTOs and... APCs, as they are called, real-time optimizers, those kind of stuff. And in some cases, we are getting half a percent yield extra. Till last year, we had done pilots in both Mumbai and Wysak refinery. This year, we have decided that every single unit where we want to put RTO, we will put it in this financial year. We will saturate it this year. And HRRL, once it gets streamed, we will also get on to that. That's the third theme which we are bringing in. Good morning, everyone. Obviously, in line with the word, where do we use AI, Generative AI? Again, a real example I will give you. We have a vehicle tracking system where 30,000 of our trucks which go on the road are tracked every day. Now, it is not, they give us, if it stalks at any place, if it goes off route, it should give an alarm. We were getting 80,000 alarms a day. Obviously, nobody is doing anything with the alarms. But using AI systems, now we have managed to get it down to few hundred real alarms a day. That's an AI tool which we have put in. So that's just as an example we are doing. Procurement, we are trying to use AI. So you can say agentic AI use cases, etc. And we are also leveraging the power of our people. We are running, as we speak, organization-wide hackathon where our youngsters are participating in some of these things and creating those. So it's a holistic program. So next analyst call, we'll give you an update on the Parikalp. We might even give you a new name for that. But it's a lot of effort. Part of it is catching up, part of it is leapfrogging. That's very clear. Thank you.

Thank you. We will take the next question from the line of Sumitraura from Smartphone Capital Private Limited. Please go ahead.

Yeah. Hi, sir. A very good afternoon to you and team SPCL. Sir, firstly, I would like to congratulate you and your entire team for our absolutely stunning performance in an extremely tough environment. So, great show, sir. And I would also like to, you know, talk a few good words about our director friend, Mr. Narang. I mean, it's been a real honor and a pleasure interacting with him over a decade. So, sir, thank you very much. It has been a real honor for all our investors and analysts, you know, to always, you know, speak to you at conferences and on analyst calls, sir. Thank you and wish you all the very best and for a great future, sir, after your annual. Now, sir, coming to just a few questions which I have from my side. So, sir, you know, firstly, you know, this government has known to be, you know, a very proactive government as, you know, for the conference we had, you know, in last September as well, you know, Our Honourable Oil Minister spoke very clearly, you know, talking about, you know, bold initiatives. So, sir, do you think that, you know, probably the time, you know, has come wherein, you know, there could be a possibility that, you know, we could go back to something like, you know, what we wore in the past, like a daily kind of a pricing mechanism or something of that sort. Sir, secondly, you know, there is absolutely been so much of noise, you know, in the media about this thousand crore figure. But, sir, is my understanding correct that a substantial part of this 1,000 crore would be the LPG part, which is actually the running account of the government and not necessarily borne by the OMCs? So, is my understanding correct on that as well, that, you know, the LPG losses are the ones which are contributing substantially towards the 1,000 crore figure, if at all so it is, which is quoted in the media? Sir, my third question, sir, is on the Balmer refinery. You know, now the fact, matter of fact, is that, you know, we are ramping it up. So, our dependence to buy products from third party would start coming off very sharply. So, can you, you know, just throw some bit of highlight on that? And so, just one last point, as our Honourable Oil Minister even yesterday spoke about, you know, that he interacts one and a half a day with all the CMBs of all the oil companies. So, what is the general thought process? Because even today, the RBI governor has spoken about, you know, fuel price hikes, you know, happening. So, what is it that the government is actually contemplating in terms of, you know, pricing? Because, you know, they are a very reformist government. So, I'm fairly confident that they will take the correct measures. But, you know, if you can just share some thought on that, it will be very good, sir. Thank you so much.

Thanks, Omid. That's a lot of questions. I'll have to jig my memory to remember all, but if I forget, you can remind me. I think let me start with the last point, which is obviously, as the Honorable Minister said on the stage yesterday, there has been a very active coordination across OMCs, across all the sector companies with the government, and this does include a daily meeting. At least six days a week, if not seven days, to look at things. We obviously discuss all the situations, what problems we are having, what issues, all there. Now, what the discussion forward-looking is, I'm not going to discuss in this forum. Not fair for me to do that. But all I would say is, again, I'll draw from what is in the public domain. The Honorable Prime Minister said that the companies are... Facing the challenge of it. I think RBI governor also, he was speaking at a conference today, he was on television about a couple of hours ago, spoke about it, the Honorable Minister spoke about it. I think there is a recognition, and to be fair, the OMCs have withstood the shock to the economy at this point of time. Now, whether the shock is, yes, there is some on account of LPG losses also because LPG was very scarce, commodity and prices were very high. To be fair, there are losses on liquid products also because crude, which we were buying at 60s in terms of dollars, 60, 65, three months ago or four months ago, is easily touching 100 at times 100 and 10, 120. So crude has gone up by. Thank you. Would be taken balancing all those factors. What those decisions are, not fair for me to comment on this. The only thing I would say is I think you were part of that group when we had that analyst meet in Mumbai a few months ago, and both the then-secretary, Mr. Jain and the Honorable Minister, actually both from the stage have talked about the fact that they understand The Dynamics and they had encouraged everybody to look at the sector as a long-term sector. There were enough people who were saying, oh, oil companies are earning more than what they should be earning. This quarter, they are earning less than what they should be earning, but hopefully, from a longer-term perspective, life would balance out on those. On the more operational question on Barmer product and all, yes, once all those things stabilize, depending on how fast diesel grow, we do expect HPCL's dependence on outside products to reduce. It won't come to zero, but there are obviously Thank you very much. Have some amount of product which we can export outside the country, and we are trying to figure out what's the best way of it. Some studies have been done, some outreaches have been done. But that, we had moved further down on that, but after the crisis, we have paused that, because right now, every country is looking at securing the product for itself. Once the situation eases and the world is back to the normal, we will again think of what's the best way of utilizing our surplus product. But we are fully conscious of the fact that we would literally become, I would say we will still take product from two of our joint ventures or three of our joint ventures, but as an ecosystem, HPCL would be reasonably self-sufficient on most products.

Okay, sir. Thank you so much and wish you all the best, sir. Thanks a lot.

Thank you. We will take the next question from the line of Vidyadar Gindi from Soham Asset Managers, Private Limited. Please go ahead.

Thank you, sir. So, my first question is, please, the big losses on diesel and some on petrol have started. Have the private players sort of tried to increase prices and price themselves out or their market share roughly remains what it was before this event happened?

Sorry, the line got distorted in between. Could you repeat the question, please?

Yeah, so my question was that has the market share of private players gone down in Petroldees and have they priced themselves out of the market or they continue to sell at these high losses and their market share is roughly what it was in January.

I think you all are very smart analysts. You can just take a drive down the highways and figure out and you'll get the answer to your question. All I would say in this is, in this moment of crisis, there were three oil companies who were standing with the Indian consumers. They were the three OLCs. They stood by the Indian consumers. They faced the brunt. We got a lot of negative press for queues in front of our retail outlets. Well, the queues are only happening at the retail outlets which are supplying. No queue was going to be ever rebooted at a retail outlet which was not supplying. So, if I have a wish right now, if I had more money, I would have done a tagline which says that we stood by the customers. That's all I would say on this. You guys are your own judges. You take a drive around and you can figure out where the market shares have gone.

My second question is that you probably are having big losses on diesel and also significant losses on petrol marketing, but you are at the same time making higher tracks on especially diesel. And to the extent what you outsource, you probably are making much smaller losses. So, the number which the Minister has quoted, is it, if you would give us some color, is it closer to the net number of the extent to which the losses on marketing exceed the losses which you make on refining, or is it the gross marketing loss number?

Yeah, I have twice or twice said in the call, we will not be giving any forward-looking guidances. I think that there is a number which was quoted in public domain, it's fair. That was maybe a directional number given by the Honorable Minister. I lead a listed company. The moment I give a guidance on an analyst call, which is recorded, I have to be sure of the numbers. Given the volatile situation, in two or three instances, we have said that we are uncomfortable giving a number and we will not give that number. Because it's unfair at this point. What if prices change tomorrow, the things will go all over the place. I know you guys are anxious on that number, but as a responsible listed company, I will not get that number.

Lastly, I hope that in the current year, if unfortunately the war drives on for a longer time, we won't have a repeat of FY23 when you are allowed to lose money, be in the red. So, I hope that it is ensured that to the authorities that matter, it is conveyed that it is not fair to allow a company which is doing its national duty to go into the red.

I think there are enough instances of the government thinking on this in public domain. As far as, I'll recall just in... At the time, Honorable Prime Minister was addressing the parliament in response to the president's speech at the inception of every year, which is given in parliament. He actually mentioned the fact that with a lot of pride that many of the state-owned companies, which used to languish earlier, are performing very well and doing their duties. Similarly, for those who were at the analyst meet, both the then-Secretary Mr. Pankaj Jain and the Honorable Minister from the dais last year at Tajland, then when we met, had clarified this point very clearly and encouraged all of us to look at the long term when you are dealing with these companies rather than looking at the short term. Just give me one second. So, this is something which I think that should be enough for us to give the cue that nobody is going to be left hanging high and dry. All what we can say is, from our side, we are definitely doing what is required to manage the situation, and we are doing it with a lot of gusto, a lot of feeling.

Thanks a lot, sir.

Thank you. We will take the next question from the line of Yokesh Patel from Dollar Capital. Please go ahead.

Thanks for an opportunity, sir. Some numbers side again, but I hope you will be able to share it, not on the pricing side. What is the proportion of petrol, diesel, and the ATF HPCL purchased from the other refiners to market at the HPCL pump? If you could share these numbers in the million metric ton, that would be helpful.

I think what I would suggest is on this one, you can reach out to our corporate finance team. They can share the detailed numbers. You can drop them a query. They will give you the shared numbers. I'm conscious of everybody's time on this. We do take product from others, and I think that's a clearly declared number. And what we have taken in the last quarter, or we are taking right now, is roughly in the same ratios which we were doing earlier. We can give you the exact numbers. Please take it offline with our corporate finance team.

Okay. Second question, again, the pre-war level, we used to take the Saudi benchmark for the FBG prices. Now, in this current scenario, a quite fluid scenario, what would be the ideal benchmark for the calculations?

The benchmark, obviously Saudi CP is used as the benchmark that itself has gone very high, but not only benchmarks, the premium on the benchmarks have also gone very haywire in the recent past. I think there is one benchmark which is used in the government. I'm sure the government takes care of its benchmark. For what you guys do, I think you will have to fend for yourself in terms of what benchmarks do you want to use. Only thing I would say is, from the benchmarks, it is a very volatile situation as compared to what it was earlier, both in terms of benchmarks being high and the premiums on top of the benchmark. That was the first thing. What was the second question?

Thank you. What elements go into it?

No, that was the U.S. part. Should I repeat that? No, no, I got it. I remembered it. So U.S. sourcing, I think oil marketing companies had actually taken an initiative to source LPG from U.S. We had already done a contract for multiple cargos, which actually incidentally started from January. So every month, all the three OMS are getting four cargos between them, and there are some optional cargos. So that is flowing all this while. To source short-term, I think the biggest challenge is, two challenges exist. One, there isn't too much of surplus LPG capacity anywhere in the world. That is one. Second, practically for U.S., the distances are too long. It takes about 80 days for a ship to turn around from here to there. The same thing for Middle East was 14 days. So, if I need 10 ships for Middle East, I would need... And the last

one, if you could just give us a perspective, compare it to Arab Gulf or Middle East. The actual landed cost of LPG from Middle East to India and US to India, which one would be better? Just for our understanding.

It is absolutely impossible to calculate this at this point of time because you get situations, all kinds of situations in the market, from premiums to super premiums. Okay, somebody absorbing cargo freight prices, somebody not absorbing. So right now, if I have to do a comparison, I live on the comparison, not on a systemic basis. I live on the comparison on what's happening on the time of the day and the daily basis comparison. Because in a normal situation, I would have given you those numbers, and typically in the long run, U.S. LPG was marginally higher than what's... Long-run landed in two hours marginally higher than what long-term average on CPP into India would have been, but right now it is impossible to. There are cargoes which we suddenly find, oh, this is way cheaper than CPP coming in here. See, remember, the last 70 days has been one where the availability of the product has been very scarce. So, a lot of effort has been to just secure the pipelines, secure the ships, etc. Pricing is a later factor right now. So, it's a very abnormal price to even do, abnormal time to do the pricing comparisons.

Thank you, sir, and wish you all the best.

Thank you.

Thank you. We will take the next question from the line of Amit Murarka from Access Capital. Please go ahead.

Yeah, hi, good afternoon, and thanks for the opportunity. On the refining side, I just wanted to understand, like, given that there is too much volatility around. The spreads, which we see on the screen, but also on the crude sourcing, as you said, like, a lot more spot cargo has been taken plus change in the slate itself. So just wanted to get a sense of, like, how should we look at refining margins? Like, is it still fair to say that the margins that you're earning, like, with all these constraints around more LPG production and all that is much better than the pre-war situation? If you could just help us understand that part.

Yeah, I think... See, for an integrated company, I have always held a view, though as analysts, you always ask for GRMs, that refinery margins, frankly, don't matter for me as an integrated company. For what matters for me is the crude and the selling price. But having said that, since the question is specifically on refining margin, I would say at the broadest level, you can assume that if it was the perfect environment in the same situation, refineries, Thank you. So, from that perspective, you can expect refineries to perform strongly on that. On LPG conversion into this, actually, very few refineries have been affected from a value perspective as much. Only if you are integrated, then you are more affected. Otherwise, the maximum you could anyway do is there is a limit to how much you can swing towards LPG, and that is well within the operational parameters. So, I think it will be too complex to just, because that depends refinery to refinery, but broadly, I would say refineries could have done better in the same environment with all the pricing, et cetera, if they had the operationally the best crews available. So, to that extent, From my vantage point, there is a bit of understatement in refinery performance in the recent numbers.

Sure. Understood. But if you could just add a bit more on that, like when you, let's say, buy your products from a refinery, any other refinery in the country, there is also that export rebate which is in place. So is it getting adjusted in the procurement or that's out of the ambit?

Yeah, to a certain extent, it is getting adjusted in the procurement price.

Sure, sure. Got it. Thank you very much, and best wishes.

Thank you. We will take the next question from the line of Kirtan Mehta from Baroda BNP Paribas Mutual Fund. Please go ahead.

Thank you, sir, for the opportunity. A couple of questions from my side. One on the supply of crude. So, you mentioned that we have started sort of procuring crude for July, and for July, with the return of European refinery from maintenance and globally market, short of... The crude, which has been lost. Do you see more challenges for procurement of crude during July as compared to May or June? That was the first question. Second question was, are we also sort of seeing a lower diesel yield than which would have been otherwise because of the unavailability of the... Medium heavy grade crude, which have a higher diesel yield. So is that also sort of making us impact our crude select at this point of time? And would that delay basically the benefit that we see out of the RUF unit?

Well, I think a good question. On the availability from Europe, I don't see any challenge on that because we are in the market, and if I'm not mistaken, we have secured half of July already. As I said earlier, we typically buy on a 60-day cycle. So I think till about 15 July, we have covered ourselves the normal procedure, and we have not had any. Thank you. It impacts everyone in the cycle. I can bet no refinery in India was running on the optimum slate because they did not have the optimum crews, they did not have the optimum mixes. Given the challenges which we had, I'll be very honest, a lot of our rough, if I do, the best crew to run is some of the Persian Gulf crews. But if they are not available, I have to run on the second best where some parameters definitely go down. So, it impacts and in an ideal situation, the same assets as I said in response to previous question would give us more returns. That's why I said broadly the refinery performance is understated in this quarter.

Can I also squeeze in one more follow-up on the previous participant question?

Okay.

In terms of the... What we mentioned earlier is that we have been incorporating some amount of discounts while we purchase crude from the other refiners on the line of export duty. This round, the revisions on the export duty has not been very frequent and periodic. So, are our adjustments run in line with the export duty or are we sort of adjusting more frequently, keeping in view the volatility? Is the target crack around $20, $22 on diesel and ATF at this point of time?

The procurement price of the RTPs are adjusted in line with the declared SAED, which is that.

That's going to be a fortnightly exercise. Yeah.

It has not been announced at least to the media in fortnightly business. So is it happening on a fortnightly basis?

It is happening as and when the government declares the SAED.

Okay. And is the underlying target crack around $20 for diesel and ETF at this point of time?

The government would be able to clarify.

Sure, sir. Thank you.

Thank you. We will take the next question from the line of Vikash Jain from CLSA. Please go ahead.

Thanks for taking my questions. But before I ask my questions, firstly, I want to thank Rajneeshji for all the help over the last few years. And, you know, of course, congratulations on a great stint and all the best for your future endeavors. And with that, I will, of course, start with an accounting question, given that it's Rajneeshji, it's, you know, super innovating. The depreciation that I see has gone up. Can you confirm when is a large part of the standalone linked capitalization already done? And when was it done? I mean, what would the number look like, say, in FI27 for the full year?

See, part of the depreciation has gone up because during this year, we have capitalized the rough unit.

Yeah.

That has happened in the last quarter, primarily, the full last year of quarter. Plus, there is an impairment testing which has been done for some of our assets. So, there is an element of impairment also included in the process.

How much would that amount be, the impairment part, sir?

That is around 400, 400, 450 crores.

Okay, and so... Would, is there any other pending capitalization left or almost all of the rough has been capitalized now?

No, it has been capitalized.

Okay, so can I say that that 2400 minus 400 crores, about 2000 crores would be the going run rate or was it capitalized during the quarter and not the full quarter?

No, no, it was, it took the full quarter, yeah, the depreciation was for the full quarter. 3rd January quarter, calculation. 31st, we, yeah, okay.

Okay, okay, sure, sir. And just on the LPG part, roughly, what is the kind of, you know, LPG loss that we, that we saw for the month of April, I mean, per cylinder loss that we were running for the month of April, like?

170.

170 per cylinder in April. May is around 670.

170 in April and 670 higher. 670 per cylinder. You got the numbers, Vikas?

Sorry, 170, Vikas, you said 170 in April, 170 per cylinder.

Yeah, 170 per cylinder in April and 670 in May.

617. And this number compares to roughly about 84 rupees in 4Q. Is that right?

Yeah. Maybe approximately. Yeah.

Okay. Okay. Thank you so much. Otherwise, I think, Vikas, your opening remark was good enough to answer most of the PMTF questions. So, thanks a lot.

Thank you.

Thank you. We will take the next question from the line of Sabri Hazarika from MTGlobal. Please go ahead.

Yeah, just two questions. Firstly, just what already has been asked. So, with the SAED, our integrated margins could be similar to the other OMT also, who has a higher refining to marketing mix. Is that right? Can you repeat your question, please? I mean, our refining to marketing ratio was lower than other oil marketing companies, but the SAID now takes care of it, right? That the integrated margin of all the three companies could be similar right now.

No, no, see, it would depend on the individual refineries as to what rate they are having and what rate they have bought the crude, fuel and loss, and there are a host of other activities apart from the SAID also.

Right, but the disadvantage which HPCL had in procuring products from other refiners on a very high crack environment, that gets sorted, right?

Not fully, but partially to an extent, what you are saying is right.

I still don't get the margin on that, refining margin on that.

And plus, we don't know at what level the SAE has been fixed.

Right, and secondly, the bookkeeping question, so what was the GRM, EBITDA, and PAT for HML in Q4 and FY26 as a whole? See the...

So, GRM for Q4 was around $17 per barrel.

Okay, and EBITDA and Pact?

EBITDA for full year was around 6,800 crores, and for the Q4 was 3,300 crores. 3,300 crores.

3,300 crores positive Pact for the full year. Thank you so much, and I'd like to wish Naranji all the best for his future endeavour. Thank you so much, and all the best. Thank you.

Thank you very much. Dearies and gentlemen, we will take that as the last question, and with that concludes the question and answer session. I now hand the conference to Mr. Vartarajan for the closing comments. Thank you. No what to you, sir.

Thanks, Ophanali. I again would like to take this opportunity to express my sincere thanks to Mr. Rajas Naran. for his extended outreach to the investor community, as well as all the support he has been giving to all the analysts and the investors all through these years. It was a great effort, and it is a heartfelt thanks from our side, and also congratulate him for his future endeavors. I'd like to hand over the floor to the CMD for his closing remarks.

Thank you. It's been almost one and a half hours we've been on this call, so I won't keep people back further. All I want to say is the team is very committed, very excited with the momentum we have built. Of course, fighting hard to meet the current challenges, but also equally very hungry to create further things. So we have sat as a leadership group immediately after the results. We're starting to do the projection, which is the next time. Then how soon can we beat these numbers? So hopefully you will see great momentums ahead, and hopefully these times would pass. Till that time, I would say, stay. Happy and healthy, and keep focusing us. Those of you who write reports on us, please share them. We love to hear your views and also learn from what you think we are not doing well, and again, we'll connect in three months from now. Thank you, and those of you who wish to meet us, we are more than happy to have separate dialogues in smaller groups or individually. Thank you, and all the best.

Thank you, members of the management. On behalf of Antique Stubb Token Limited, we conclude this conference. Thank you all for joining with us today, and you may now disconnect your lines. Thank you.