With the demand of petrol reaching pre-COVID-19 levels, state-run Hindustan Petroleum Corporation Limited (HPCL) has embarked on its growth plan, stated HPCL chief Mukesh Kumar Surana. The revival of business has encouraged HPCL to offer Rs 2,500-crore buyback.
Speaking to The Free Press Journal, Surana said, “The worst is over for the industry and it is coming back to normal. But it needs to be seen if we can recover the losses made in the first two quarters.” He added that the demand for petrol has improved substantially to 100 per cent demand of pre-COVID-19 levels, while diesel is positioning its growth. “Now that the demand has reached pre-COVID-19, we can carry out our growth plans,” stated Surana. HPCL reported a standalone net profit of Rs 2,477 crore in the September quarter as against Rs 1,052 crore a year ago. It is more than double compared to a year ago. "Our results show revival." Meanwhile, the total income of the company decreased to Rs 62,419 crore as compared to Rs 66,854 crore in September 2019.
The board approved buyback of 10 crore shares, which represents 6.56 per equity share, at Rs 250 per share. “We realised that the market value is not the reflection of the value HPCL can offer.” Thus, it is offering premium value in the case of the buyback and offering better value to the shareholders by this buyback, reflected Surana during the press briefing.
The company hopes to stick to its capex plan of Rs 12,000 crore for the current financial year. “It will be in this line if not more,” claimed Surana, who also admitted there has been a slight delay in some projects but hopes to catch with the delay soon.
HPCL is also keen to continue with its renewable plans which have not been impacted due to COVID-19. “We plan to spend Rs 5,000 crore in the next five years in City Gas Distribution (CGD) business,” he said. At present, HPCL has CGD in 20 geographical locations.
In addition, the work on the bioethanol plant in Bathinda and biogas plant in Uttar Pradesh is in progress. Meanwhile, the company will be enabling all the new outlets with solar power. It has 350 solarised outlets so far.