Global brokerage firm CLSA expects shares of state-owned Bharat Petroleum Corporation Limited (BPCL) to rise further by about 3 percent. The brokerage has upgraded the rating for the stock to ‘Hold’ from ‘Underperform’. Also a target price of ₹ 271.2 per share has been given. This is about 3 percent higher than the closing price of Rs 263.80 on BSE on January 24. Meanwhile, Morgan Stanley has maintained ‘overweight’ rating on BPCL stock. The target price has been kept at ₹ 419 per share, which is about 60 percent more than the current price.
The market cap of BPCL is Rs 1.14 lakh crore. The stock has fallen 10 percent so far in the month of January. The stock had seen a 52-week high of Rs 376 on September 30, 2024 on BSE. Since then it has come down by about 30 percent.
Profit increased by 20 percent in December quarter
According to CLSA, BPCL’s December quarter results missed expectations due to weak refining performance and unexpected inventory expenses. However, the company hopes that this will be compensated by the compensation given by the government in the upcoming budget. BPCL’s consolidated net profit rose 20 per cent to Rs 3,805.84 crore in the October-December 2024 quarter. The profit in the same quarter a year ago was Rs 3,181.42 crore.
The company had made a profit of Rs 2,297.23 crore in the July-September quarter. On the other hand, due to fall in oil prices, the company’s revenue from operations declined to Rs 1.27 lakh crore in the December quarter. It was Rs 1.3 lakh crore in the same quarter a year ago.
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Nuwama Institutional Equities has highlighted concerns over BPCL’s weak refining margin environment and LPG under-recovery. These are affecting the company’s income. Nuvama has reiterated its ‘Reduce’ rating for BPCL and given a target price of ₹246 per share.
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