Prabhudas Lilladher has adjusted the price target for Bharat Petroleum (BPCL) to Rs 305 from Rs 318. The revision follows updated throughput estimates for FY27 due to planned refinery maintenance shutdowns. Despite lower refining margins, the company reported a standalone EBITDA of Rs 89.7 billion, supported by an improvement in marketing margins.
Brokerage firm Prabhudas Lilladher has updated its outlook on Bharat Petroleum Corporation, revising the target price for the stock to Rs 305 from Rs 318. This adjustment follows a recalibration of the company's refining throughput estimates for the 2027 fiscal year.
The core reason for the downward revision in throughput is the management's schedule for refinery maintenance shutdowns, which are planned for the third and fourth quarters of the current fiscal year. As a result, the company's annual throughput projection has been lowered to 40.1 million metric tonnes, down from the previous expectation of 41.9 million metric tonnes. These operational pauses are common in the refining sector to maintain asset efficiency but often lead to temporary reductions in processing volumes.
Operational performance metrics for the company showed mixed trends in the recent quarter. The net refining margin declined to USD 14.0 per barrel from USD 17.0 per barrel in the previous period. Analysts have attributed this contraction to higher crude freight costs and the lack of discounted Russian crude oil supplies. Conversely, the marketing margin—the profit earned on the sale of petroleum products—demonstrated resilience. It improved to a profit of Rs 5.5 per liter, contrasting with a loss of Rs 5.4 per liter in the previous period. This recovery was aided by relatively softer crude oil prices during July and August.
On the earnings front, the company reported a standalone EBITDA of Rs 89.7 billion. This performance was achieved despite an accounting impact of Rs 4.0 billion related to foreign exchange losses. The brokerage noted that this financial result performed better than initial market estimates.
Looking ahead, investors may focus on the company's capital expenditure plans for the 2028 and 2029 fiscal years. These spending programs are important as they will influence future return ratios. The brokerage maintains an 'Accumulate' stance on the stock, utilizing a 1.2x price-to-book valuation for its target calculations.