MRPL’s Profitability Surge: A Look at Robust Refining Margins

Mangalore Refinery and Petrochemicals Ltd (MRPL) has witnessed a significant turnaround in profitability during the July-September quarter, driven by robust refining margins. The company reported a net profit of Rs 1,059 crore for this quarter, marking a stark contrast to the Rs 1,789 crore loss incurred in the same period last year.

Refining Margin Boost

MRPL’s impressive performance can be attributed to its refining margin, which stood at USD 17.11 per barrel in the quarter. This is a notable improvement compared to the negative gross refining margin of USD 4.46 per barrel recorded in the corresponding period last year. The positive refining margin played a crucial role in elevating the company’s financial health, especially amidst the volatile international oil market triggered by geopolitical events like Russia’s invasion of Ukraine.

Revenue and Operational Highlights

While MRPL’s revenue from operations dipped to Rs 22,844 crore in Q2 from Rs 28,453 crore last year due to lower oil prices, the company showcased operational excellence in other areas. Notably, MRPL achieved a record gross crude throughput of 1.43 million tonnes in July, surpassing previous milestones. The refinery also produced the highest-ever monthly volume of petrol at 195,000 tonnes in August before a scheduled maintenance shutdown.

Financial Position and Strategic Initiatives

MRPL’s financial position also witnessed positive shifts, with a reduction in interest-bearing long-term borrowing and an improvement in the Debt-Equity Ratio from 2.24 to 1.17. The company’s net profit for April-September amounted to Rs 2,072 crore on a turnover of Rs 47,676 crore, showcasing consistent growth compared to the previous year.

Looking ahead, MRPL is focused on expanding its retail marketing footprint under the HiQ brand, aiming to achieve a sales target of 1 million tonnes in the next 3 to 5 years. Additionally, the company is strategically exploring opportunities in green fuels and conducting future expansion configuration studies to enhance profitability in alignment with the evolving energy landscape.

MRPL’s resurgence in profitability reflects its resilience and strategic foresight in navigating market dynamics while pursuing sustainable growth avenues.