logo
MRPL shares rally over 6%; YES Securities sees better Q2 on improving refining margins

MRPL shares rally over 6%; YES Securities sees better Q2 on improving refining margins

Economic Times7 hours ago
Shares of Mangalore Refinery and Petrochemicals Ltd (MRPL) climbed as much as 6.4% on Wednesday to Rs 154 on the BSE, lifting their two-day rally to 10.6%, as investor sentiment improved on expectations of a recovery in earnings and a more supportive margin environment.
ADVERTISEMENT MRPL's gains pushed its market capitalisation to Rs 26,709.61 crore. Despite the recent uptrend, the stock remains 31.5% below its 52-week high of Rs 224.80, touched in July 2024, though it has rebounded 55.6% from the 52-week low of Rs 98.95 recorded in March 2025.
Brokerage Yes Securities retained its 'buy' rating on the stock following the company's first-quarter results last week, raising its price target to Rs 180 from Rs 160. The new target implies a valuation of 1.9 times FY27 estimated price-to-book value.
MRPL had reported a consolidated net loss of Rs 271.97 crore for the quarter ended June 2025 (Q1FY26), reversing from a net profit of Rs 73.22 crore in the same period last year. Revenue from operations fell to Rs 20,988.03 crore from Rs 27,289.40 crore year-on-year.Yes Securities attributed the earnings weakness to extended shutdowns and inventory losses. The company's gross refining margin (GRM) came in at $3.88 per barrel for the quarter, significantly below the brokerage's forecast of $7.3 per barrel. In comparison, MRPL had reported GRMs of $6.23 per barrel in the previous quarter and $4.70 per barrel a year ago.The underperformance was linked to a 45-day Phase-II shutdown—longer than anticipated—driven by severe rainfall, as well as lower plant utilisation and limited feedstock availability that hit product exports.
ADVERTISEMENT
Looking ahead, Yes Securities said the company is positioned to benefit from an uptick in refining spreads in the second quarter, supported by elevated diesel cracks and geopolitical risk premiums on crude following the Israel–Iran conflict. With Brent crude averaging around $70 per barrel, the brokerage expects near-term GRMs to remain firm in the first half of FY26.
The brokerage also highlighted MRPL's advantageous crude sourcing mix, with over a third of its supply sourced from Russia at discounted rates, helping it maintain some of the highest GRMs among single-location Indian refiners.
ADVERTISEMENT
Over a three-year horizon, Yes Securities sees earnings quality improving as MRPL moves further into petrochemicals and retailing, while capitalising on integrated operations and upcoming pipeline infrastructure. Demand for value-added products is projected to outpace fuel demand, with the company targeting stable leverage despite elevated capex levels. MRPL's net debt-to-equity currently stands at 0.99x, with debt at Rs 13,230 crore.
A potential merger with Hindustan Petroleum Corporation Ltd (HPCL), while speculated in the past, remains unlikely in the near term, the brokerage said. Any such move would depend on the promoters, ONGC and HPCL, and may be deferred beyond FY27 due to tax-loss carryforwards from the OMPL merger.
ADVERTISEMENT
Also read | Aditya Birla Real Estate shares down 32% from peak. Can the stock reclaim Rs 2,400 post Q1 results?
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
(You can now subscribe to our ETMarkets WhatsApp channel)
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

India-UK Free Trade Deal: Whisky, cars from Britain to get cheaper, tariff cut on cosmetics, medical devices, more
India-UK Free Trade Deal: Whisky, cars from Britain to get cheaper, tariff cut on cosmetics, medical devices, more

Mint

timea few seconds ago

  • Mint

India-UK Free Trade Deal: Whisky, cars from Britain to get cheaper, tariff cut on cosmetics, medical devices, more

India and the UK will sign a free trade agreement on Thursday during Prime Minister Narendra Modi's visit to London. The free trade deal, when formalised, will make it cheaper to export labour-intensive goods like leather, footwear, and clothing, while also reducing import costs for whisky and cars from Britain. The pact also helps double trade between the two economies to USD 120 billion by 2030. According to Reuters, India will be reducing tariffs on nearly 90 per cent of the UK goods. This means that whisky and gin levy will fall from 150 per cent to 75 per cent, then to 40 per cent in a decade Cars from Britain are also likely to get cheaper as automobile tariff will likely fall from 100 per cent-plus to 10 per cent under quota Cosmetics, medical devices, salmon, chocolates, and biscuits will face less tariffs. The UK to offer duty-free access to 99 per cent of Indian items, according to Indian commerce ministry, covering nearly 100 per cent of trade value. Indian exports like textiles, footwear, gems and jewellery, furniture, auto parts, chemicals, machinery, and sports goods are likely to face zero duties in the UK, down from the current 4 per cent - 16 per cent. According to Indian commerce ministry, assured access will be provided in the UK to business visitors and contractual service providers as well as to yoga instructors, chefs and musicians for temporary stay. Indian workers working temporarily in the UK and their employers will be exempted from paying social security contributions in the UK for three years, with savings estimated at about ₹ 40 billion ($463 million) annually, Reuters reported. India will allow British suppliers to bid for non-sensitive federal government procurement tenders, with a threshold set at ₹ 2 billion. The deal will give UK businesses access to India's public procurement market, comprising about 40,000 tenders with a value of about 38 billion pounds a year, according to UK government estimates. (With Reuters research and inputs)

Infosys ADR shares jump over 3% on NYSE after IT major's net profit rises 9% YoY to  ₹6,921 crore. Details here
Infosys ADR shares jump over 3% on NYSE after IT major's net profit rises 9% YoY to  ₹6,921 crore. Details here

Mint

time3 minutes ago

  • Mint

Infosys ADR shares jump over 3% on NYSE after IT major's net profit rises 9% YoY to ₹6,921 crore. Details here

Infosys ADR Shares: India's second-largest IT company, Infosys Ltd's American Depository Receipt (ADR) shares jumped over 3% to $18.83 on the New York Stock Exchange (NYSE) after Wall Street opened on Wednesday, 23 July 2025. The Infosys ADR shares rose over 3% to $18.83 at the US market open, compared to $18.26 at the previous market session on Wall Street. The company announced its April-June quarter results after the Indian stock market closed on Wednesday. As of 11:12 a.m. (EDT), the shares of the IT major were trading 1.48% higher at $18.53. After hitting its intraday high levels, the ADR stock dropped to its current level as of the early market session. ADR shares are tools that foreign companies use to leverage a special certificate issued by a US bank to trade on the US stock market, similar to other regular US-based companies. India's second-largest IT company, Infosys, posted a 9% rise in its consolidated net profits to ₹ 6,921 crore for the first quarter of the 2025-26 fiscal year, compared to ₹ 6,368 crore in the same quarter in the previous fiscal year. However, the company's net profits dropped 1.6% on a sequential basis in the April-June quarter. Infosys' revenue from core operations increased 7.5% to ₹ 42,279 crore in the April-June quarter of the financial year ended 2025-26, supported by consistent deal momentum and sustained demand for digital transformation services from global clients. According to Mint's earnings coverage, the company also revised its 2025-26 fiscal year constant currency revenue growth guidance, raising the lower end to 1% while retaining the upper end at 3%. Infosys ADR shares trading on the NYSE have given US market investors more than 68% returns on their investment in the last five years. However, the shares were down 15.13% in the last one-year period. On a year-to-date (YTD) basis, the IT major's ADR stock has dropped 17.19% and is trading 2.91% lower in the last five market sessions on Wall Street. The shares hit their 52-week high at $23.63, while the 52-week low level was at $15.82. The shares are trading above their year-low levels, and the company's market capitalisation stands at $75.52 billion as of the stock market session on Wednesday, 23 July 2025. Read all stories by Anubhav Mukherjee Disclaimer: This story is for educational purposes only. The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.

Two ways State Bank of India plays a role in Maldives' development
Two ways State Bank of India plays a role in Maldives' development

First Post

time3 minutes ago

  • First Post

Two ways State Bank of India plays a role in Maldives' development

From resort development loans in the 1970s to interest-free budgetary support in 2024, SBI's footprint spans the Maldivian archipelago read more India, via SBI, has been helping Maldives' economy for decades now. File image The State Bank of India has emerged as a key financial player in the Maldives, playing a decades-long dual role that supports private sector growth and national fiscal stability. From resort development loans in the 1970s to interest-free budgetary support in 2024, SBI's footprint spans the Maldivian archipelago. Since it began operations in the Maldives in February 1974, India's largest state-owned bank has been at the forefront of funding the country's tourism industry, helping to build the very resorts that now anchor the local economy. STORY CONTINUES BELOW THIS AD It has further extended credit to firms engaged in marine exports and fishing, reinforcing India's longstanding financial presence in the island nation. Interest-free Treasury Bill support Beyond private sector engagement, SBI has provided sovereign budgetary support that goes to show the strategic angling of Indo-Maldivian ties. In 2022, India, via SBI, subscribed to US$100 million in domestic Treasury bonds issued by the Maldivian government. The loan came with a sovereign guarantee from New Delhi and no interest charges: an extraordinary concession in sovereign finance. This model continued into 2024. At the request of the Maldivian Ministry of Finance, SBI rolled over two separate US$50 million Treasury Bills in May and September, again on a zero-interest, 'government-to-government' basis. These measures were aimed at helping the Maldives cope with acute fiscal stress and maintain budget liquidity without adding to debt-servicing burdens. A uniquely generous model of assistance India's support via SBI is unusually generous in global finance, offering interest-free debt and sovereign guarantees. While other lenders impose market-based rates, New Delhi's willingness to underwrite the Maldives' fiscal stability shoes economic practicality and geopolitical intent in the Indian Ocean region. The bank's assistance has helped the Maldivian government manage high external debt and prevent payment disruptions. Officials familiar with the matter say this direct lending mechanism reflects 'a high-trust, bilateral financial architecture' that allows rapid responses to economic emergencies. Stabilising the economy, reinforcing influence The larger impact of this support is unmistakable. Indian credit, delivered through SBI, has given the Maldives room to stabilise its balance of payments, keep essential imports flowing, and begin fiscal reforms. In the short term, such aid has insulated Male from market volatility; in the long term, it reinforces Indian influence at China's maritime doorstep. Meanwhile, SBI's legacy in the Maldivian private sector continues to shape employment and enterprise. From aviation and fisheries to housing and trade, the bank's commercial credit lines have fuelled entrepreneurship for half a century.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store