Prabhudas Lilladher has given Hold recommendation for Bharat Petroleum Corporation with a target price of Rs. 331 in its research report issued on Sep 01, 2022

Prabhudas Lilladher’s research report on Bharat Petroleum Corporation

We interacted with BPCL management during recent Mumbai refinery visit. Management indicated 1) Expansion of Bina refinery to 11.5MTPA from 7.8MTPA along with 1.2MTPA ethylene capacity will cost Rs400bn 2) polypropylene (PP) capacity addition of 40,000tons will cost Rs50bn 3) plans to file Field Development Plan (FDP) for Brazilian field (BM Seal 11 concession) by Nov-22 and develop the block at $1.6bn over next three years and 4) targets to achieve net zero carbon emissions in Scope 1 and Scope 2 by CY40.

Outlook

We maintain earnings and rating as ‘HOLD’ at TP of Rs331, as rising diesel marketing losses remain a concern despite healthy refining outlook.

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