Rs 15/Share Dividend Announced: PSU Gas Stock Soars 75% In 3-Months, Buy?

Mid-cap stock operating in the Gas & Petroleum sector Hindustan Petroleum Corporation Ltd (HPCL) has approved an interim dividend of 150%, i.e. Rs 15, on each equity share of Rs 10. In a separate announcement, the state-run also declared its third quarter results (Q3 FY24) on Thursday. In its results for the quarter ended on December 31, 2023, HPCL's net profit rose 206.80% at Rs 529.02 crore compared to Rs 172.43 crore in the corresponding period last fiscal.

HPCL shares fell as high as 8% in the intraday trading on Thursday. Shares of Hindustan Petroleum Corporation Ltd closed 4.91% lower at Rs 430.25 per share today. HPCL stock price has gained 74.90% in the last three months. The state-owned refiner has declared 33 dividends since July 27, 2000. One must note that in 2023, the oil refiner did not announce any dividend.

The company has fixed February 7, 2024, as the "record date" for the purpose of ascertaining the eligibility of shareholders for payment of interim dividend. The said Interim Dividend would be paid to eligible shareholders on or before February 23, 2024.

Brokerage house, Prabhudas Lilladher Pvt Ltd has given a "Sell" rating for the stock. The stock is currently trading at 1.2/1.1x FY25/26 P/BV.

HPCL Dividend Record Date:

In an exchange filing on January 25, 2024, the company said, "It is further informed that the Board declared an Interim Dividend of 150% i.e. Rs. 15 per equity share of face value of Rs.10/- each for the year 2023-2024. In terms of requirements of Regulation 42 of SEBI LODR, the Board has also fixed February 7, 2024, as the "record date" for the purpose of ascertaining the eligibility of shareholders for payment of interim dividend. The said Interim Dividend would be paid to eligible shareholders on or before February 23, 2024."

HPCL Dividend Payment Date:

The company today said that the interim Dividend of 150% i.e. Rs. 15 per equity share would be paid to eligible shareholders on or before February 23, 2024

HPCL Q3FY24 Results:

In Q3FY24, HPCL's net profit stood at Rs 529.02 crore, up 206.80% from Rs 172.43 crore in the corresponding period last fiscal. However, the state-run refiner posted a sharp decline in profit on a sequential basis, down 89.66% from Rs 5,118.16 crore in Q2 FY24.

HPCL mentioned that the QoQ profit fell primarily due to suppressed marketing margins on select transport fuels, lower refining margins attributable to lower cracks, and falling crude prices during the period. The company's revenue from operations for the October-December 2023 period stood at Rs 1,18,443 crore. The state-run oil marketing company's operating margin contracted sharply to 0.70% from 6.80%, QoQ.

Crude throughput during the December quarter was 5.34 million tonnes as compared to 5.75 million tonnes in the September quarter. It was 4.83 million tonnes in the year-ago quarter. The firm's domestic sales volume rose to 11.36 million tonne in Q3FY24 from 10.95 million tonne, YoY, and from 10.08 million tonne, QoQ.

Rating for HPCL stock: Sell

The brokerage firm Prabhudas Lilladher Pvt Ltd has given a "Sell" rating to the HPCL stock. Swarnendu Bhushan, Co-Head of Research, Prabhudas Lilladher Pvt Ltd said that HPCL reported lower than expected results with EBITDA/PAT of Rs21.6bn (-74%QoQ; PLe: Rs27.7bn) and Rs5.3bn (-90%QoQ; PLe: Rs9.7bn). "Refining throughput at 5.3 mmt was down 7% QoQ (PLe:5.4 mmt). Marketing sales including exports improved 11% QoQ to 11.9 mmt. The stock is currently trading at 1.2/1.1x FY25/26 P/BV," Bhushan added.

HPCL Share Price Performance:

Shares of HPCL have gained 74.90% in the last three months, and 16.55% in the last one month. The last one-year, 2-year, and 3-year returns from HPCL shares have gained 73.31%, 38.06%, and 95.43% respectively.

About HPCL:

Hindustan Petroleum Corporation Limited is a Maharatna CPSU and (HPCL) is a Government Company within the meaning of Section 617 of the Companies Act 1956. HPCL is an amalgamation of the erstwhile foreign oil companies ESSO and Caltex, which were taken over by the Government of India in 1974 and 1976 respectively.

HPCL is a Central Public Sector Undertaking, with a subscribed capital of Rs. 339.33 Crores.

HPCL is one of the largest integrated Public Sector Undertaking, engaged in the business of refining Crude Oil and marketing of various petroleum products like Asphalt, Diesel, Kerosene, LPG, Lube Oils, Petrol, branded products like ATF (Aviation Turbine Fuel), Power, Turbojet, Naphtha, throughout India and at select foreign countries. Some of these products are exported to other countries.