Company Update : Mangalore Refinery and Petrochemicals Ltd By Motilal Oswal Financial Services Ltd
Beat on EBITDA/PAT driven by higher-than-estimated GRM
* MRPL’s 4QFY25 EBITDA beat our estimates by 34%, as reported GRM came in ~USD1/bbl above our estimates at USD6.2/bbl. However, PAT was affected by a higher-than-estimated tax rate. Refining throughput was in line with our estimate at 4.5mmt. Singapore GRM has weakened further in Apr’25TD, averaging USD3/bbl (vs. USD3.2/bbl in 4QFY25). We have a bearish stance on refining over FY26-1HFY28 due to strong ~2.5- 3mb/d net refinery capacity additions globally over CY24-26, demand concerns due to rising trade tensions and possibilities of a global macroeconomic slowdown. MRPL currently trades at 6.5x 1yr. fwd. EV/EBITDA and 1.7x 1yr. fwd. P/B. We have a Sell rating on MRPL.
* While MRPL’s 4QFY25 refining throughput was in line with our estimate at 4.5mmt, reported GRM came in above our estimate at USD6.2/bbl (est. USD5.3/bbl).
* As a result, EBITDA came in 34% above our estimate at INR11.2b.
* PAT came in 103% above our estimate at INR3.6b.
* Profitability also improved slightly by a forex gain of INR86m. However, the actual tax rate was above our estimate.
* In FY25, net sales grew 5% to INR947b, while EBITDA/PAT stood at INR25b/INR506m (vs. INR78.3b/INR36b in FY24).
* Other highlights:
* The distillate yield reached a new peak of 81.93%, representing an improvement over the previous high of 78.77% recorded in FY24.
* The highest-ever production of ATF/Benzene, at 2.72mmt/0.21mmt, was achieved during FY25, along with record aromatic complex output of Reformate/95RON MS at 1.20mmt (previous best: 0.83mmt).
* Bitumen train and PFCC Wet Gas Scrubber projects were commissioned during the year.
* The Devangonthi Marketing Terminal was commissioned, with dispatch of all three products (MS, HSD & ATF) commencing during the year. Additionally, 66 new retail outlets (ROs) were commissioned, bringing the total to 167 ROs, including three new ROs in Tamil Nadu.
For More Research Reports : Click Here
For More Motilal Oswal Securities Ltd Disclaimer
http://www.motilaloswal.com/MOSLdisclaimer/disclaimer.html
SEBI Registration number is INH000000412
