Mumbai : We are going through some tough times, as the COVID-19 pandemic perpetrated one of the world’s worst humanitarian and economic crises. Treading the recovery path cautiously, humanity is emerging stronger, tougher and wiser, getting accustomed to a new normal.
Resolute in its service to the nation and society, BPCL’s thousands of Corona Warriors across the country worked relentlessly, risking their lives, yet ensuring the availability of petroleum products at all times. This bears testimony to the indomitable spirit with which we stand tall, braving the challenges posed by the pandemic, thus redefining resilience. On the physical front, your Company improved its performance, despite significant loss of sales in March 2020. The Company recorded market sales of 43.10 MMT and refinery throughput of 31.91 MMT for the year 2019-20. It is indeed a matter of great pride that your Company was the only Oil Marketing Company (OMC) amongst PSU OMCs to register a growth in physical performance during the year. However, on the financial front, the profit after tax of the Company, on a standalone basis declined to Rs. 2,683 crores, on account of losses incurred in the fourth quarter, mainly due to lower refining margins and substantial inventory and foreign exchange variation losses. Similarly, at the group level, while market sales and refining throughput were higher at 43.36 MMT and 38.30 MMT respectively, the profit after tax attributable to BPCL fell to Rs. 3,055 crores. The Board of Directors announced a dividend of 165%, the highest amongst the PSU OMCs.
The Company is at the threshold of a major transformation as it prepares for a definitive change in the ownership structure with the imminent disinvestment of the Government of India’s stake in it. This is expected to unlock tremendous value through sharpening of professionalism, improvement in efficiencies, increased investments, access to advanced technologies and newer global markets and product diversification, thus propelling future growth. It is due to this confidence in the intrinsic value of the Company, that its market capitalization has scaled peaks in recent times and is quoting at a significant premium over its PSU peers.
28th September 2020
Fully seized with the emerging reality, your Company has a concerted focus on approaches which can best be explained under 4 Rs:
Re-energizing lives through innovative value-added propositions backed by a comprehensive digital ecosystem, meticulous Resource planning and management to reduce redundancies and enhance efficiencies, rigorous Risk mitigation in the current volatile situation and Reinventing ourselves to meet the challenges of the present and the future.
I am delighted to mention that your Company has made substantial progress in its Go-GDP approach, through which we foster our commitment towards a Greener environment, infuse Digitalization in all aspects of our business and augment our Petrochemicals product portfolio.
Aspiring to be a most admired energy company, BPCL has ventured into alternate fuels/energy solutions, which will enable swift scale up once these verticals prime up and economics improve. Further, with the Propylene Derivative Petrochemical Project (PDPP) at Kochi Refinery (KR) about to start commercial production and the project to produce Polyols and related products at KR being on track, your Company is poised to become a recognized player in the Petrochemicals space.
Reinforcing our commitment to the national Startup India initiative and nurturing the spirit of entrepreneurship, your Company launched a Startup contest to find innovative solutions to six specific business challenges with interesting results which we intend taking up further.
At the group level, in July 2020, Bharat PetroResources Limited (BPRL), BPCL’s wholly owned upstream subsidiary, along with the Concessionaires, has finalized debt financing of USD 14.9 billion for the two train Area 1 Mozambique LNG project, achieving a major milestone towards monetization of the asset.
The Refinery Expansion Project of our subsidiary, Numaligarh Refinery Limited is progressing well and has been accorded environmental clearance in July 2020, a crucial landmark in the progress of the project.
In a major step towards consolidating our interests in group companies, Bharat Oman Refineries Limited, hitherto our 50:50 Joint Venture Company, has undergone a change in equity structure, consequent to the conversion of warrants into equity shares, resulting in BPCL’s shareholding increasing to 63.38%.