Bharat Petroleum Corporation Sees Price Target of Rs 325: Prabhudas Lilladher Research

Bharat Petroleum Corporation's Q4FY26 Earnings Review

Bharat Petroleum Corporation's refining throughput stood at 10.4 million metric tons (mmt) in Q4FY26, in line with Prabhudas Lilladher's estimate of 10.5mmt. The refining throughput remained flat quarter-over-quarter (QoQ) and declined by 1.7% year-over-year (YoY).

The reported Gross Refining Margin (GRM) improved sharply to $18.0 per barrel (bbl) in Q4FY26 from $13.2/bbl in Q3FY26, supported by stronger crack spreads amid the West Asia war. However, the implied Gross Marketing Margin (GMM) softened to INR5.6 per liter from INR6.2/ltr in Q3FY26 primarily due to higher crude oil prices in March 2026.

The company's Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) came in at INR100.6 billion, exceeding Prabhudas Lilladher's estimate of INR61.4 billion and Bloomberg's estimate of INR77.9 billion. The EBITDA increased by 29.6% YoY and declined by 13.8% QoQ, driven by stronger refining performance despite a forex loss of INR9.4 billion.

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The reported Profit After Tax (PAT) declined to INR31.9 billion, down 57.7% QoQ and flat YoY, due to higher interest costs and an impairment charge of INR43.5 billion related to BPRL. Adjusted PAT stood at INR64.5 billion, increasing by 41.7% YoY while declining by 14.5% QoQ.

Crude Sourcing Update

Bharat Petroleum Corporation increased its Russian crude mix to over 40% as of May 2026, up from 25% in Q3FY26 and 31% in Q4FY26. The company has secured all its crude requirements through July 2026.

Outlook and Recommendation

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Prabhudas Lilladher has revised its assumptions and now builds in GRM of $7.1/6.8/bbl and GMM of INR2.4/4.5/ltr for FY27E/FY28E, reflecting a weaker near-term outlook. The research firm maintains a 'Accumulate' rating and revises its target price to INR325, based on 1.3x FY28E Price-to-Book Value (P/BV).