Prabhudas Lilladher has given Buy recommendation for Bharat Petroleum Corporation with a target price of Rs. 505 in its research report issued on Mar 02, 2021

Prabhudas Lilladher’s research report on Bharat Petroleum Corporation

BPCL board approved the sale of 61.65% stake in Numaligarh Refinery (NRL) to a consortium of Oil India, Engineers India and Government of Assam for an EV of Rs160bn. The transaction values NRL at P/E of 8x/10x and EV/E of 5x/8x FY19/20 respectively. The transaction is likely to be closed within a month of getting all the approvals. This is in line with BPCL management commentary to close the transaction by Q4FY21 end. Proposed stake sale is a precursor to eventual divestment of BPCL, which will likely conclude by H1FY22E.


Reiterate BUY as BPCL remains a prized asset given its footprint across energy value chain. We value BPCL at PER 9X FY22 and add value of investment and E&P.