MRPL Shares Rally 11% This Week, Reclaiming 20-Day Moving Average

Overview

Mangalore Refinery and Petrochemicals Limited (MRPL), a subsidiary of ONGC and a Schedule “A” Mini Ratna Category I company, recently reported its financial performance for Q2 FY 2024-25. Despite achieving significant operational milestones, MRPL faced a challenging quarter financially, driven by fluctuations in crude oil prices and global market pressures. Here’s a detailed breakdown of MRPL’s earnings and key achievements for this quarter.

MRPL Share Price Surges, Reclaims 20-Day Moving Average

The share price of MRPL gained nearly 3% on November 6, 2024, following an impressive 11% jump in the previous trading session—its best single-day gain in recent months. This recent rally has propelled MRPL’s stock to reclaim its 20-day moving average (20-DMA), signaling renewed momentum. Over the course of this week, MRPL’s share price has climbed by a total of 11.20%, showcasing a robust upward trend.

Operational Highlights

Enhanced Capacity Utilization
MRPL has shown impressive operational efficiency this quarter with record crude processing levels. The company achieved a capacity utilization rate of 118.3% in Q2 and 117.6% for the first half of the fiscal year. This reflects MRPL’s strong focus on maximizing its production capabilities to meet market demands.

New Terminals and Depots Operational
The company commissioned the Devangonthi Marketing Terminal in August 2024, marking the start of High-Speed Diesel (HSD) tanker loading operations. Additionally, MRPL made the Elathur depot fully operational, which now dispenses a substantial volume of 15 thousand kiloliters (TKL) monthly, enhancing MRPL’s supply chain capabilities.

Financial Performance

For Q2 FY 2024-25, MRPL reported a revenue from operations of Rs 28,786 crore, a notable increase from Rs 22,844 crore in Q2 FY 2023-24. However, the company faced a substantial loss before tax (PBT) of Rs 1,041 crore compared to a profit of Rs 1,606 crore in the same quarter last year. The loss after tax (PAT) stood at ₹682 crore, a stark contrast to the profit of Rs 1,059 crore achieved in Q2 FY 2023-24.

MRPL’s financial losses this quarter stem from challenging market conditions, particularly in crude oil prices, which have impacted refining margins. The gross refining margin (GRM) fell significantly to US$ 0.55 per barrel from US$ 17.11 per barrel a year ago, illustrating the severe impact of global pricing pressures on MRPL’s profitability.

Half-Year Financial Overview

For the first half (H1) of FY 2024-25, MRPL’s revenue from operations rose to Rs 56,075 crore from Rs 47,669 crore in H1 FY 2023-24. Despite the increased revenue, MRPL posted a loss after tax of Rs 617 crore, significantly different from the profit of Rs 2,072 crore it reported for the same period in the previous year. The decline in profitability is attributed to lower gross refining margins (GRMs) due to volatile global crude prices, impacting earnings.

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