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Motilal Oswal Report
Mangalore Refinery and Petrochemicals Ltd. reported a substantial miss versus our estimates in Q2 FY25 due to a weak refining performance, with gross refining margin coming in at $0.5/barrel of oil (our estimate: $5/bbl).
The weakness in Q2 FY25 financial performance was likely a result of weaker core GRM as well as inventory loss coming in higher than our estimate ($2.5/bbl).
Following the weak Q2 FY25 result, we cut our FY25 Ebitda by 50% as we temper our GRM assumption to $4.5/bbl (earlier: $6.6/bbl).
We also reduce our FY26 Ebitda by 24% and revised our GRM assumption to $6.9/bbl (earlier: $8.4/bbl).
Further, we model a throughput of 17 million metric tonne for FY25/FY26. In H1 FY25 MRPL has reported a net loss of Rs 6.1 billion while in H2 FY25 we are building in moderate improvement in refining GRM (due to seasonally stronger winter months) leading to H2 FY25 PAT of Rs 10 billion.
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