Chennai Petroleum Corporation shares extended gains for the second day on Tuesday after the oil refiners reported strong earnings for the June quarter. Its shares surged as much as 19.4 per cent today on top of Monday's 15 per cent gains. In last two trading sessions the stock has gained 37 per cent.
Chennai Petro on Monday reported 150 per cent annual jump in its net profit to Rs 924 crore for the June quarter, on the back of strong operational performance. However, its revenue fell 30 per cent to Rs 9,053 crore from Rs 12,985 crore in the corresponding quarter of last fiscal on account of lower oil prices.
Its operating income came in at Rs 1,001 crore against an operating loss of Rs 108 crore in the year ago period.
Chennai Petro's strong growth in operating income was driven by its gross refining margins, a measure of profitability for refining companies, which grew to $10.09 a barrel from $1.88 in the same quarter last year.
Commenting on the earnings, Chennai Petro said it has taken various energy conservation schemes, which contributed to its bottom line.
Hemen Kapadia, senior vice president at KR Choksey Securities told NDTV that Chennai Petro's shares have completed an 8-year decline from 2007 to 2015 and has now entered into a long-term uptrend. "On technical parameters, the stock looks good," he added.
Chennai Petro shares closed 17.7 per cent higher at Rs 241.40 apiece, outperforming the broader Nifty, which fell 0.74 per cent today.
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