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Key trends in oil & gas sector in Q1FY22 were: 1) Dubai and Brent crude were up 109-118% YoY at US$66.5-68.6/bbl on a very low base; 2) domestic gas price was down 25% YoY but flat QoQ at US$2.0/mmbtu (10-year low); 3) Reuters’ Singapore gross refining margin (GRM) was at a 7-quarter high but weak at US$2.05/bbl; 4) auto fuel net marketing margin was down 77% YoY at Rs1.4/l; and 5) auto fuel consumption was up 22-35% YoY and total products up 19% YoY on a low base but down 12-18% YoY over Q1FY20 levels. We estimate Q1FY22E EPS to be sharply down YoY for BPCL and HPCL, modest growth for GSPL and Petronet (PLNG) and strong to very strong growth on low base for others. We expect strong YoY growth to sustain for GAIL, ONGC and OIL in the rest of FY22E.

* RIL’s Q1 EPS up 32% YoY: RIL’s consolidated recurring EPS is estimated to be up 32% YoY driven by: i) 49% YoY rise in O2C EBITDA; ii) 103% YoY rise in retail EBITDA and iii) 19% YoY rise in digital services EBITDA. We estimate pre-tax profit to be up 102% YoY but profit rise to be more modest on 15x rise in tax on a low base.

* IOC’s EPS up 86% YoY but HPCL & BPCL down 67-70% YoY: We estimate IOC’s EPS to be up 86% YoY driven by US$4.8/bbl YoY higher GRM at US$2.9/bbl boosted by inventory gain vs inventory loss in Q1FY21 and 3.4x YoY jump in petrochemical EBITDA to Rs24.5bn. We estimate HPCL and BPCL’s standalone EPS to be down 67-70% YoY, hit by 65-55% YoY lower marketing EBITDA and 20- 59% YoY lower product inventory gain at Rs3.5-4.1bn, respectively.

* OIL in the black vs in the red & ONGC’s EPS up 7.8x YoY: We estimate ONGC’s EPS to be up 7.8x YoY driven by 125% YoY rise in net oil price realisation. Oil India’s (OIL) EPS is estimated at Rs2.7 vs loss in Q1FY21 on 116% YoY rise in realisation.

* GAIL’s EPS up 8.5x YoY: We estimate GAIL’s EPS to be up 8.5x YoY driven by: i) Gas marketing EBITDA at Rs7.5bn vs loss of Rs5.8bn in Q1FY21; ii) petrochemical EBITDA at Rs2.5bn vs Rs0.4bn loss in Q1FY21; iii) 134% YoY rise in LPG and other hydrocarbon EBITDA and iv) gas transmission EBITDA up 28% YoY driven by 21% YoY rise in volumes to 109mmscmd. Petrochemical volumes are estimated to be down 45% YoY on maintenance shutdown for 1.5 months.

* MGL, GGL & IGL’s EPS will be up 3.9-8x YoY: We estimate EPS of MGL, GGL and IGL to be up 3.9x, 7.4x and 8x YoY driven by 119%, 136% and 103% YoY rise in volumes and 52%, 53% and 129% YoY rise in EBITDA margin, respectively.

* Standalone EPS of GSPL up 7% YoY: We estimate GSPL’s standalone EPS to be up 7% YoY driven by 3% YoY higher tariff and despite 4% YoY lower volumes.

* PLNG’s EPS up 19% YoY: PLNG’s EPS is estimated to be up 19% YoY driven by 6-8% YoY rise in Dahej regas volume and charge.

* Castrol’s EPS up 151% YoY on 53-55% rise in per unit EBITDA and volumes

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