Table of Contents
Which company is better HPCL or BPCL?
Having said that, the upside will be better for HPCL than for BPCL….So what is driving BPCL’s valuations higher?
| Operational Parameters | BPCL | HPCL |
|---|---|---|
| Crude thruputs (MMT) | 24.03 | 14.75 |
| Market Sales including exports(MMT) | 32.19 | 27.03 |
| Domestic market sales (MMT) | 29.58 | 25.50 |
| Gross refining margins (US$ per barrel) | 4.47 | 5.30 |
What is difference between HPCL and BPCL?
Today, HPCL is the third largest among the Indian Oil Refining and Marketing Company….
| Bharat Petroleum | Hindustan Petroleum | |
|---|---|---|
| Short forms | BPCL | HPCL |
| Industry Type | Oil and Gas | Oil and Gas |
| Traded as | BSE: 500547, NSE: BPCL | BSE: 500104, NSE: HINDPETRO |
| Owned by | Government of India | Government of India |
What is the difference between BPCL and HPCL?
Bharat Petroleum Corporation (BPCL) is India’s second-largest oil marketing company and has a market share of 22\% in the domestic sales volume in the Financial Year 2020. Hindustan Petroleum Corporation (HPCL) is an oil & natural gas company with the second-largest share of product pipelines in the country.
As seen, BPCL has better return ratios ( RoCE and RoE) as compared to its peers and hence justifies its premium valuation to certain extent. All the three companies have higher debt to equity ratios because of the capital intensive nature of the sector. However, BPCL and HPCL look good in terms of interest coverage ratio.
Having said that, the upside will be better for HPCL than for BPCL. For example, if there is any increase in petroleum product prices, it should be more positive for HPCL (keeping other factors constant).
Why is BPCL more self-reliant in sales generation?
As we can see from the chart, when it comes to self reliance in sales generation, BPCL fares better. This is because BPCL on account of its higher refining capacity relies less on other companies (indicated by Products purchased for resales).