Gulf Oil Lubricants Q1 Results Review - Well-Oiled Momentum Continues To Build Up: ICICI Securities

ICICI Securities Report

Gulf Oil Lubricants India Ltd. reported another stellar set of results in Q1 FY25, with Ebitda/profit after tax growth of 25.3%/28.9% YoY, its second-best in the last eight quarters. Volume growth of 15.4% YoY was also solid and it has been delivering as per management’s guidance of above-industry/peer growth over the next two-three years.

Core lubricant/Adblue volume of 37/38 million litres (+5.7/26.7% YoY) was marginally below our estimates, with Adblue volumes a tad weaker. Gross margin was up 40 basis points QoQ, but Ebitda margin was down 20 bps to 13.1% due to higher SG&A expenditure.

We remain positive on Gulf Oil prospects over the next two-three years, with steady volume growth, stronger margins and limited threat from EVs, at least, in the next three-five years. Valuation of 14.3 times FY26E earning per share/ 9.5 times enterprise value/Ebitda is attractive. Maintain 'Buy'.

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