Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Key Takeaways
Hopeful on policy reforms to reduce under-recoveries
The management indicated that it has the back-end ready for the government's
recently announced policy to limit the number of domestic LPG cylinders per household.
However, it ruled out dual pricing in diesel due to practical difficulties in
implementation.
Bhatinda refinery commercial production likely by end-2011
The management indicated that its new 9mmtpa Bhatinda refinery (JV with Mittal
Energy Investments, HPCL stake at 50%) with Nelson Complexity of 12+ is mechanically
complete and expects commercial production to commence by December 2011.
The final capex of the refinery stands at ~INR190b. HPCL expects refining margins
to higher by ~USD6/bbl over the regional benchmark Singapore margins.
New greenfield refinery planned in Maharashtra
HPCL is planning to set up a 9-18mmtpa greenfield refinery in Ratnagiri district in
Maharashtra.
While it has already received some land allocation, the management indicated that
it will require additional land for the project.
To expand Visakh refinery to 15mmta (currently 8.5mmtpa)
As against the earlier trend of annual capex of ~INR350b per year, HPCL is planning
to spend ~INR400b-450b per year in the next two years.
It also plans to expand the Visakh refinery capacity from the current ~8.5mmtpa to
15mmtpa, with a capex of INR80b by FY15/16 (currently, detailed feasibility report
is being prepared).
Some of the key ongoing/completed projects include:
- LOBS quality upgradation at Mumbai: Mechanically complete; estimated cost:
INR10.3b
- Single-point mooring at Visakh: Commissioned; total cost: INR6.4b
- New 1.45mmtpa FCCU at Mumbai: Mechanically complete; estimated cost: INR9b
- New diesel hydrotreater at Mumbai and Visakh: Targeting completion by
September 2011; estimated cost: INR70b
Valuation and view
In the event of subsidy rationalization and decontrol of retail fuel prices, marketing
profits would improve and the stock could see a re-rating.
The stock trades at attractive valuations of 9.6x FY12E EPS of INR39.3 and 1x FY12E
BV. Buy.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Key Takeaways
Hopeful on policy reforms to reduce under-recoveries
The management indicated that it has the back-end ready for the government's
recently announced policy to limit the number of domestic LPG cylinders per household.
However, it ruled out dual pricing in diesel due to practical difficulties in
implementation.
Bhatinda refinery commercial production likely by end-2011
The management indicated that its new 9mmtpa Bhatinda refinery (JV with Mittal
Energy Investments, HPCL stake at 50%) with Nelson Complexity of 12+ is mechanically
complete and expects commercial production to commence by December 2011.
The final capex of the refinery stands at ~INR190b. HPCL expects refining margins
to higher by ~USD6/bbl over the regional benchmark Singapore margins.
New greenfield refinery planned in Maharashtra
HPCL is planning to set up a 9-18mmtpa greenfield refinery in Ratnagiri district in
Maharashtra.
While it has already received some land allocation, the management indicated that
it will require additional land for the project.
To expand Visakh refinery to 15mmta (currently 8.5mmtpa)
As against the earlier trend of annual capex of ~INR350b per year, HPCL is planning
to spend ~INR400b-450b per year in the next two years.
It also plans to expand the Visakh refinery capacity from the current ~8.5mmtpa to
15mmtpa, with a capex of INR80b by FY15/16 (currently, detailed feasibility report
is being prepared).
Some of the key ongoing/completed projects include:
- LOBS quality upgradation at Mumbai: Mechanically complete; estimated cost:
INR10.3b
- Single-point mooring at Visakh: Commissioned; total cost: INR6.4b
- New 1.45mmtpa FCCU at Mumbai: Mechanically complete; estimated cost: INR9b
- New diesel hydrotreater at Mumbai and Visakh: Targeting completion by
September 2011; estimated cost: INR70b
Valuation and view
In the event of subsidy rationalization and decontrol of retail fuel prices, marketing
profits would improve and the stock could see a re-rating.
The stock trades at attractive valuations of 9.6x FY12E EPS of INR39.3 and 1x FY12E
BV. Buy.
No comments:
Post a Comment