State-run Bharat Petroleum Corporation (BPCL) is expected to report a better set of numbers in Q1 FY24 on an annual basis helped by a recovery in marketing margins due to softening International crude oil prices and cheap Russian supplies.

BPCL is the first of the three state-run oil marketing companies (OMCs), which is scheduled to report its Q1 FY24 performance on Wednesday.

The performance of Indian Oil Corporation (IOC), whose results are scheduled for Friday, and Hindustan Petroleum Corporation (HPCL) are also expected to be on similar lines. HPCL is yet to announce its results date.

ICICI Securities said that a moderation in both crude oil costs and softer product prices is likely to benefit OMCs’ marketing earnings in Q1. Marketing margins, after showing steep losses over H1 FY23, have steadily recovered over the last four months.

“We estimate petrol and diesel margins at a stellar ₹8-9 per litre in Q1. Coupled with GRMs of $7.7-9 per barrel (net of windfall tax, estimated inventory loss, and Russian crude cost-benefit), EBITDA/PAT for the 3 OMCs are likely to show sharp improvement both YoY and even QoQ vs the strong Q4 FY23 results,” the brokerage added.

In Q4 FY23, BPCL reported a throughput of 10.63 million tonnes (MT) against 10.15 MT a year ago. Market sales stood at 12.91 MT in Q4 FY23 compared to 11.82 MT in Q4 FY22. During the entire FY23, the throughput was 38.53 MT against 35.89 MT in FY22.

The OMC also reported its highest-ever market sales of 48.92 MT in FY23 against 42.51 MT in FY22, with growth of 15.08 per cent.

On Tuesday, Crisil Ratings said that the operating profit of the three state-run OMCs is expected to hit ₹1 lakh crore in FY24, from the average of around ₹60,000 crore between FY17 to FY22.

The cumulative operating profit of ₹1 lakh crore by IOC, HPCL, and BPCL in this financial year will be three times of the profit of ₹33,000 crore clocked in FY23, it added.

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