Public sector undertaking oil marketing major BPCL beat Street expectations and surprised analysts with excellent results. The company reported an operating profit of Rs 11,100 crore in the fourth quarter of the 2022-23 financial year or Q4FY23 (vs Rs 4,200 crore quarter-on-quarter or QoQ and Rs 5,900 crore year-on-year or YoY).
 
The beat was driven by far better than expected gross refining margins (GRM). The adjusted net profit was at Rs 7,800 crore (Rs 2,000 crore QoQ, Rs 2,500 crore YoY) while the reported bottom line was Rs 6,500 crore, as BPCL recorded an impairment of Rs 1,400 crore on its investment in BPRL.
 
The reported GRM for the quarter was at $20.7/bbl against expectations of Rs 13/bbl. Adjusting for export taxes (at an estimated $ 9/bbl), the realised GRM is likely to be around $ 16.7/bbl. Although GRMs have moderated in Q1FY24, the marketing margins on petrol, diesel and LPG have more than compensated by strong recoveries.